Question

Part 1 Below is a production possibilities table for consumer goods (butter) and capital goods (guns).

Production Possibilities
Type of Production	Production Alternative A	Production Alternative B	Production Alternative C	Production Alternative D	Production Alternative E	Production Alternative F	Production Alternative G
Butter	0	1	2	3	4	5	6
Guns	14	13	11	9	7	4	0

Graph the data provided in the table using Excel. (Hints: Type your data into an Excel spreadsheet. With your mouse, highlight the data only. Go to insert. Click on scatter. Click on smooth lines chart. Select the line chart. Plot data drawing line.)

Based on the graph you created, complete the following:

·        Analyze the graphed data to develop assumptions, referencing the possibility curve.

Answer 1

Referencing the possibility curve, is based on below assumptions:

-- In an economy the amount of resources in which are fixed, despite them being able to be transferred from one use to another

-- Technology innovation is assumed to be constant

-- The resources are completely utilized and efficiently applied

-- Only two good can be produced with resources

-- Resources are not equally as efficient in the products process of production