This exercise will offer students the opportunity to use their graphing skills in preparing a simple production possibilities curve and will be an excellent lead-in to Chapter 2. Emphasis should be placed on the choices made based on different allocations of capital and labor. As the concept of a productions possibilities curve will not be introduced until Chapter 2, the instructor should take time to illustrate a sample of the results portrayed graphically.

Materials Needed:

Several staplers - 1 for each team
Paper - 8.5" by 11" sheets cut in half
Form teams of 5 students. Each team is to produce paper airplanes and paper cars.
Airplanes: paper is folded twice and stapled
Cars: paper is folded three times
Each team is given one stapler and several sheets of paper.
Five production periods will be carried out. In each production period, lasting 15 seconds, different allocations of capital (stapler) and labor (students) will be allocated to airplanes and cars. The allocation each period is as follows:

Each team is to use the data generated to construct a production possibilities curve.

While individual team results will differ, the instructor should use the opportunity to compare curves and discuss the concepts of scarcity, choices, opportunity cost, and trade-offs. Be sure to address situations where no capital or labor were available as well as when there was an abundance of capital or labor.