Below is a production possibilities table for consumer goods (automobiles) and capital goods (forklifts):
Type of Production, Automobiles and Forklifts
Automobiles (x) 0 2 4 6 8
Forklifts (y) 30 27 21 12 0
PtA( 0,30) B( 2,27) C(4,21) D(6,12) E( 8,0)
If the economy is at point C, what is the cost of one more automobile? Of one more forklift? Explain how the production possibilities curve reflects the law of increasing opportunity costs.
c. If the economy characterized by this production possibilities table and curve were producing 3 automobiles and 20 forklifts, what could you conclude about its use of available resources?
Please help! im really confused :S
best answer will be chosen!
thanks in advance!!