Teddy's production possibilities curve for goods M and N is described by the following equation: M = 21 - 3N,where M is the quantity of good M produced and N is the quantity of good N produced.The maximum quantity of M that Teddy can produce is
A) 63.
B) 21.
C) 14.
D) 7.
E) 0.

Question

Quizplus · Accepted Answer

To find the maximum quantity of M that Teddy can produce, we need to find the point where M is at its highest value on the production possibilities curve.

We can graph the equation M = 21 - 3N to see what the production possibilities curve looks like.

If we let N = 0, we get M = 21. This means that Teddy can produce 21 units of M if he produces no N.

If we let M = 0, we get 0 = 21 - 3N, which gives us N = 7. This means that Teddy can produce 7 units of N if he produces no M.

If we plot these two points on a graph and draw a line connecting them, we get the production possibilities curve.

To find the maximum quantity of M, we need to find the point on this curve where M is at its highest. This occurs where the curve intersects the vertical axis (where N = 0). So the maximum quantity of M that Teddy can produce is 21.

Therefore, the answer is B.

Teddy's Production Possibilities Curve for Goods M and N Is