Question

homework: chapter 02
based on the graph, between points a and b, buranda gains
this means the opportunity cost of each additional windmill is light - sabers.
if the economy keeps moving down the ppc towards the horizontal intercept, opportunity cost of each additional windmill will

Explanation:

Step1: Identify quantity changes

At point A, quantity of wind - mills is 15 and quantity of light - sabers is 25. At point B, quantity of wind - mills is 25 and quantity of light - sabers is 15.

Step2: Calculate gain in wind - mills

Gain in wind - mills = 25 - 15 = 10

Step3: Calculate sacrifice in light - sabers

Sacrifice in light - sabers = 25 - 15 = 10

Step4: Calculate opportunity cost per wind - mill

Opportunity cost per wind - mill=$\frac{10}{10}$ = 1

Step5: Analyze change in opportunity cost

As we move down the production - possibility curve (PPC) towards the horizontal intercept, the opportunity cost of each additional wind - mill will increase.

Answer:

Based on the graph, between points A and B, Buranda gains 10 wind - mills but has to sacrifice 10 light - sabers. This means the opportunity cost of each additional wind - mill is 1 light - saber. If the economy keeps moving down the PPC towards the horizontal intercept, opportunity cost of each additional wind - mill will increase.