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The graph is attached
Answer:
A)
Position B: This position is the point of inefficiency, because B lies inside the production possibility frontier (PPF). At this level, resources are not satisfied.
Position V: The point V on this PPF, can be said to be a point of fuller utilization.
Position D: The point D is a point over the PPF. At this point level of production is unattainable or unfeasible.
ii) Opportunity cost of producing 10000 more tons of rice is 10 units of machinery.
In this case, when 10,000 more tons of rice are produced, there would be a movement from point T to V. The production of rice would increase by 10,000 units and the machinery production would be reduced by 10 units.
B1) Production of fertilizers would lead to an increase in the production of rice because fertilizers helps farm produce. On the graph there would be an outward rotation of PPF on the x axis. This would be PPF2, knowing that PPF1 is the level of origin.
B2) The discovery of steel would lead to the availability of more raw materials needed for the machinery to produce rice. Here, on the Y axis, which is the machinery axis, there would be a rotation from PPF1 to PPF3.
B3) When the $100 billion is given to them, this would lead to an increase in overall production level, as they may decide to higher more labour or even purchase enough inputs. Here, there would be a shift from PPF1 to PPF4.
