Scenario: Linear Production Possibility Frontier

question 128

Essay

Scenario: Linear Production Possibility Frontier
Largetown has a linear production possibility frontier, and it produces socks and shirts with 80 hours of labor.The table shows the number of hours of labor necessary to produce one sock or one shirt. (Scenario: Linear Production Possibility Frontier) Look at the scenario Linear Production Possibility Frontier.If Largetown decides to devote half of its labor time to the production of socks and half of the time to the production of shirts, what is the maximum number of socks
and shirts it can produce?
A.10 shirts and 20 socks
B.20 shirts and 10 socks
C.30 socks and 30 shirts
D.30 socks and zero shirts

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Definitions:

Least-Cost Combination

The least-cost combination is an economic principle that refers to the mix of factors of production that minimizes costs for a given level of output.

Resources

Inputs used in the production of goods and services, such as labor, capital, land, and entrepreneurship.

Output

The total amount of goods or services produced by a company, industry, or economy over a specific period of time.

Least-Cost Combination

is an economic principle where firms aim to produce a given output at the minimum possible cost by choosing the optimal combination of inputs.