Society can produce food (F) and health care (H) according to the following prod

Question

Society can produce food (F) and health care (H) according to the following production possibilities frontier: 5H2 + 2F2 = 10,000. Suppose a goal is set to produce 40 units of health care and 50 units of food. What does this goal represent?

a.

Underutilization

b.

Infeasibility

c.

Technological change

d.

Efficiency

Brief explaination why the answer is correct too. (I am using Principles of Microeconomics by N. Gregory Mankiw 6h Edition, a page number would be great!)

a.

Underutilization

b.

Infeasibility

c.

Technological change

d.

Efficiency

Explanation / Answer

5H2 + 2F2 = 10,000

putting the values we have

5*40*40+2*50*50

=13000

This is greater than 10000.

This represent technological change. As the computed value is greater than the production possibilities frontier. this must have been possible or would be possible due to advancement in technology that has led to increase in productivity. As the technology advances, its efficiency also increases. so the no comes greater than that represented by the equation.

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.