Question

(#1) Three friends, Joe, John and Jack, establish a firm JJJ that makes gadgets and tutor economics students

(#1) Three friends, Joe, John and Jack, establish a firm JJJ that makes gadgets and tutor economics students. If they all work, in one hour they can produce the following combinations of economics tutorials (ET) and gadgets (G): (0,30), (1,24), (2,14) and (3,0).
A. Compute the opportunity cost of a gadget, when 0, 1 and 2 tutorials are produced.
B. C. What could explain the increase in the opportunity cost when more gadgets are produced?
(#2) One unit of labour can produce either 2 units of x or 1 units of y. One unit of capital can produce either 4 units of x or 1 unit of y. There are 100 units of each means of production. Just one means of production is needed for the production of either x or y.
A. The opportunity cost of producing x equals 2 units of y.
B. The opportunity cost of producing x equals 0.25 unit of y.
C. The opportunity cost of producing x equals 4 units of y.
D. The opportunity cost of producing x will be 0.25 unit of y whenever we produce less than 400 units of x and 0.5 units of y whenever we produce more than 400 units of x.
E. The opportunity cost of producing y will be 0.25 unit of x whenever we produce less than 400 units of y and 4 units of x whenever we produce more than 400 units of y.
F. None of the above.

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