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In this assignment, you will create a production possibilities schedule and curve to determine what your opportunity costs are and which product is the best for you to produce.Assignment: Determining Production Possibilities
You are getting ready to open The Shoe Hut, but you need to need to determine whether you have the absolute or comparative advantage in the production of specific items. This will help you determine which product is the best for specialization.
Your production possibilities are as follows:
• You have the resources to produce up to 15 running shoe inserts.
• You have the resources to produce up to 10 hiking boot inserts.
• For every 2 hiking boot inserts produced, you give up the production of 3 running shoe inserts.
Using the information that you learned about your ability to produce running shoe inserts and hiking boot inserts, complete your production possibilities schedule.
Use the information from your production possibilities schedule to create your production possibilities curve by filling in the following graph. Use textboxes to insert text, and use lines and circles from the shapes function to illustrate your production possibilities. Be sure to mark points A through F on the graph.
Based on the data within your schedule and curve, are you using your resources efficiently? Support your answer using the data presented.
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