Economics

    Economics   Below is a production possibilities table for consumer goods (candy bars) and capital goods (bags of peanuts): Number of CandyBars Bags of Peanuts048 a) Draw the production possibility frontier.b) Is this company able to produce 12 candy bars and 6 bags of peanuts? What does this combination of output suggest about the use of resources?c) Is this company able to produce 8 candy bars and 4 bags of peanuts? What does this combination of output suggest about the use of resources? d) What happens to the opportunity cost of producing more and more candy bars? Does it increase, decrease or remain constant? Explain your answer.e) What would be the opportunity cost of producing 2  more bags peanuts if this company were currently producing 8 candy bars and 4 bags peanuts?f) What happens to the production possibilities frontier if improvement occurs in the technology of producing bags peanuts but not in the technology of producing candy bars? Problem 2 Quantity of cars Quantity chocolatesFrance 90 1800Germany 100 3,000 a- Suppose the two countries specialize and trade. Who should produce cars and who should produce chocolates? Explain your answer. Problem 3 Price(dollars per pound of cat food) Quantity demanded(tons of cat food per year) Quantity supplied(tons of cat food per year)1.00 52 151.50 46 262.00 43 342.50 40 403.00 35 44 Suppose the market for cat food has the demand and supply schedules shown in the table above.a- Draw a figure showing the demand curve and the supply curve of cat food. What are the equilibrium price and quantity? b- Suppose that the current price is $1.00 per pound of cat food. What is the quantity of cat food sold? Explain.c- Is there a shortage or a surplus? How big is it? Explain.Explain how the market adjustsd- If the supply increases by 20 tons at every price. What is the new equilibrium price and the new equilibrium quantity of cat food?e- Compared to the first equilibrium point do we have a shortage or a surplus?