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Draw a production possibilities frontier showing increasing opportunity cost for hammers in terms of horseshoes.
a.On the graph, identify the area of feasible outcomes and the area of infeasible outcomes.
b.On the graph, label a point that is efficient as point "E" and a point that is inefficient as point "I".
c.On the graph, illustrate the effect of the discovery of a new vein of iron ore, a resource needed to make both horseshoes and hammers, on this economy.
d.On a second graph, illustrate the effect of a new computerized assembly line in the production of hammers on this economy.
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