According to data from the U.S. Department of \(\begin{array}{lll}\text {
Agriculture's } & \text { National } & \text { Agricultural } & \text {
Statistics }\end{array}\) Service, 124 million acres of land in the United
States were used for wheat or corn farming in a recent year. Of those 124
million acres, farmers used 50 million acres to grow 2.158 billion bushels of
wheat and 74 million acres to grow 11.807 billion bushels of corn. Suppose
that U.S. wheat and corn farming is efficient in production. At that
production point, the opportunity cost of producing 1 additional bushel of
wheat is 1.7 fewer bushels of corn. However, because farmers have increasing
opportunity costs, additional bushels of wheat have an opportunity cost
greater than 1.7 bushels of corn. For each of the following production points,
decide whether that production point is
(i) feasible and efficient in production, (ii) feasible but not efficient in
production, (iii) not feasible, or (iv) unclear as to whether or not it is
feasible.
a. Farmers use 40 million acres of land to produce 1.8 billion bushels of
wheat, and they use 60 million acres of land to produce 9 billion bushels of
corn. The remaining 24 million acres are left unused.
b. From their original production point, farmers transfer 40 million acres of
land from corn to wheat production. They now produce 3.158 billion bushels of
wheat and 10.107 bushels of corn.
c. Farmers reduce their production of wheat to 2 billion bushels and increase
their production of corn to 12.044 billion bushels. Along the production
possibility frontier, the opportunity cost of going from 11.807 billion
bushels of corn to 12.044 billion bushels of corn is 0.666 bushel of wheat per
bushel of corn.
