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chelle21689's avatar

How am I to graph a production possibility curve?

Asked by chelle21689 (7907points) August 15th, 2011

I have this homework assignment where I’m supposed to choose two outcomes in life. Here is the directions and I’m totally lost. I want to choose “studying time” and “weekend entertainment time” as my two. How the hell am I suppose to graph this? It says to not use time or money on the graph.

Identify two competing outputs in your life. SELECT A SITUATION THAT ALLOWS FOR SOME COMPROMISE. No all-or-nothing dilemmas. Clearly, you have lots of things competing for your resources, but pick just TWO that are very important and compete with one another for the resources you have available. Choose only two because you will be translating your situation to a 2-dimensional PPC graph. FOCUS on OUTCOMES. The limited resources are your constraints and are held constant, so explain how much of your labor and human capital you have to divide between these two goals. You cannot use time or money on either axis.
Here is an example: If I have two hours of my labor and human capital (labor and human capital are the limited resources, NOT time), what can I produce? Option #1 is to grade Econ 200 papers, so the number of papers graded is the “good” produced. Zero will go at my graph’s origin and the maximum 2-hour output (say, 10 graded papers) at the x-intercept. Option #2 is to hit golf balls. I can hit 120 golf balls in 2 hours.

Finally, draw a production possibilities curve (PPC) to show the competing objectives you discussed. Scale out units of one on the y-axis and units of the other option on the x-axis. What are the “production” combinations available? Plot those points, connecting the dots to draw your curve. Mark your current position and label it I AM HERE. Then also mark where you would like to be, if it is not your current position.

I have no idea how this is suppose to look.

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4 Answers

CWOTUS's avatar

First of all, you’re planning to violate one of the terms of the assignment if you intend to graph “Weekend Entertainment TIME” or “Studying TIME” as “outcomes”. What kind of entertainment did you have in mind? Dances Danced? Drinks Drunk? Movies and Ballgames Watched? Those are ‘entertainment options’. As for the other… Homework Assignments Completed? Textbook Pages Read? Essays Written? What other outputs do you derive from “studying time”?

And calling the X-axis “Labor and Human Capital” is just an over-fancy way of saying “Time”, after all. How many dances / drinks / movies / homework assignments / pages / essays can you complete “per unit of Labor and Human Capital” ... which I presume is measured in minutes, hours, days, weeks, etc.

atlantis's avatar

If you understand the meaning of A, B, C, X, Y. You should have no problem.

atlantis's avatar

Basically, it’s an equation of your tradeoff. How much of one thing equals the other for you.

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