Table 3-5
Assume that Aruba and Iceland can switch between producing coolers and producing radios at a constant rate.

-Refer to Table 3-5. Which of the following represents Iceland's production possibilities frontier when 100 labor hours are available?

Question

Table 3-5
Assume that Aruba and Iceland can switch between producing coolers and producing radios at a constant rate.
 
-Refer to Table 3-5. Which of the following represents Iceland's production possibilities frontier when 100 labor hours are available?

Quizplus · Accepted Answer

When 100 labor hours are available, Iceland can produce a maximum of 150 radios or 40 coolers. The production possibilities frontier therefore consists of the points (0,150) and (40,0), represented in the graph by line segment CD. Option C is the only graph that includes these two points, so it is the correct answer.

Table 3-5 Assume That Aruba and Iceland Can Switch Between Producing Coolers