Table 2-8 -Refer to Table 2-8

question 3

Essay

Table 2-8
$$\begin{array} { | c | c | c | } \hline \begin{array} { c } \text { Possible Output } \\\text { Combinations }\end{array} & \begin{array} { c } \text { Cashews } \\\text { (thousands of } \\\text { pounds) }\end{array} & \begin{array} { c } \text { Almonds } \\\text { (thousands of } \\\text { pounds) }\end{array} \\\hline \text { A } & 35 & 0 \\\hline \text { B } & 30 & 20 \\\hline \text { C } & 25 & 35 \\\hline \text { D } & 20 & 47 \\\hline \text { E } & 15 & 57 \\\hline \text { F } & 10 & 64 \\\hline \text { G } & 5 & 68 \\\hline \text { H } & 0 & 70 \\\hline\end{array}$$
-Refer to Table 2-8.The Nut House produces only cashews and almonds.The table above shows the maximum possible output combinations of the two nuts using all resources and currently available technology.
a.Graph The Nut House's production possibilities frontier.Put almonds on the horizontal axis and cashews on the vertical axis.Be sure to identify the output combination points on your diagram.
b.Suppose The Nut House is currently producing at point C.What is the opportunity cost of producing an additional 12,000 pounds of almonds?
c.Suppose The Nut House is currently producing at point C.What happens to the opportunity cost of producing more and more almonds? Does it increase,decrease or remain constant? Explain your answer.
d.Suppose The Nut House is currently producing at point F.What happens to the opportunity cost of producing more and more cashews? Does it increase,decrease or remain constant? Explain your answer.
e.Suppose The Nut House is plagued by a variety of white root-rot disease,which destroys cashew trees but not almond trees.Show in a graph what happens to its PPF.

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Definitions:

NPV

A calculation technique used to estimate the value of an investment by assessing the present value of all cash flows associated with it, both incoming and outgoing.

Burnout Brand

A term referring to a brand that has lost its appeal or distinctiveness in the market, often due to overexposure, lack of innovation, or failure to maintain consumer interest.

Incremental Cash Flows

The additional operating cash flow that an organization receives from taking on a new project, distinct from the organization's existing cash flow.

Future Net Income

An estimation of a company's future earnings after all expenses and taxes have been subtracted from revenue.