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Q. Assume an economy has the subsequent production possibilities:
guns (100s per day) butter (1000kgs per day)60 040 520 100 15
A) draw the PPF. Draw the MC cure for Guns in terms of the production of butter.
b) If the economy produces 3000 guns per day, how much butter can it produce per day?
c) Assume now the economy becomes 100% efficient in producing butter. Draw the new PPF also MC curves also Conclude how much butter the economy can produce in this new situation if it produces 3000 guns per day?
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