(Solved): 5. Opportunity cost and production possibilities Raphael is a talented artist who sells hand-crafte ...

5. Opportunity cost and production possibilities Raphael is a talented artist who sells hand-crafted goods on his website. Raphael currently crafts and sells both crochet hats and embroidered sweaters. He spends 8 hours a day working on crafts. The following table gives different dally output scenarios depending on how much of his time is spent on each good. Suppose Raphael is currently using combination D, producing one crochet hat per day. His opportunity cost of producing a second crochet hat per day per day. Now, suppose. Raphael is currently using combination C, producing two crochet hats per day. His opporturity cost of producing a thira crochet hat per day is per day, From the previous analysis, you can determine that as. Raphael increases his production of crochet hats, his opportunity cost of producing one more crochet hat Suppose Raphael buys a new toof that enables him to produce twice as many crochet hats per hour as before, but it doesnt affect his ability to produce embroidered sweatersi. Use the green points (triangle symbol) to plot his new Ppf on the previous graph. Because he can now make more crochet hats per hour, Raphaeís opportunity cost of producing embroidered sweaters is previously.