Question

A farm grows soybean and produces chickens. The opportunity cost of producing each of these products increases as more of it is produced. Draw the farm's PPF. Label it PPF0

The farm adopts a new technology which allows it to use fewer resources to fatten chickens. Draw a PPF that illustrates the impact of the new technology. Label it PPF1
With the new technology, the opportunity cost of producing a bushel of soybean -blank- because -blank- must be forgone to produce a bushel of soybeans.
A. increase; more chickens
B. decreases; more chickens
C. decreases; fewer chickens
D. increases; fewer chickens
E. Does not change; the same number of chickens.

Answer 1

With the adoption of new technology to fatten chickens, the farm's production possibilities frontier (PPF) shifts, showing increased efficiency. The opportunity cost of producing a bushel of soybean decreases because fewer chickens must be forgone, indicating a shift in resource allocation towards more efficient chicken production.

Step-by-step explanation:

The opportunity cost of producing a product increases as more of it is produced. When the farm adopts a new technology to fatten chickens using fewer resources, the production possibilities frontier (PPF) will shift. We label the initial PPF as PPF0. After the technology adoption, we show the impact of the new technology with a new PPF, labeled PPF1, which would be higher for chicken production. This reflects a more efficient use of resources in chicken production.

With respect to soybean production, with the new technology, the opportunity cost of producing a bushel of soybean decreases; fewer chickens must be forgone to produce a bushel of soybeans. Therefore, the correct answer is C. decreases; fewer chickens.

Answer 2

The answer is "Increases; more chickens".

Step-by-step explanation:

New technology personal capabilities chickens resources This means that more chickens may now be raised with the same inputs and the production of soybean would stay the same. The new PPF, therefore, shared perceptions along the horizontal axis of holes. Now, each unit made from soybeans will get more chances for chicken, as many chickens have to leave with one additional soybean.