Introduction to the American EconomyWeekly Problem #2: Production Possibilities AnalysisFurniture United, Inc. produces wooden chairsand tables in a small factory in Northern Wisconsin. Mostof the output is shipped to local furniture stores which sell to cabin owners who like the “rustic” lookintheir summer homes. The capacity of the factory is limited by the size of the building and the machineryavailable. Following is an estimate of the possible combinations of chair and table output per day:ChairsTables04520404030600Based on the above information answer the following questions. Be sure to explain your answers.A.Does the production schedule reflect the Law of Diminishing Returns? (Hint:Correct answer isyes)Paige WalbergIntroduction to the American EconomyAssignment #2: Production Possibilities AnalysisFurniture United, Inc. produces wooden chairs and tables in a small factory in Northern Wisconsin. Mostof the output is shipped to local furniture stores which sell to cabin owners who like the “rustic” look intheir summer homes. The capacity of the factory is limited by the size of the building and the availablemachinery. Following is an estimate of the possible combinations of chair and table output per day:PointChairsTablesTables gainsA045B204010C403030D600X30Y15Z50Based on the above information answer the following questions.Show your calculations and Explain your answers.A.Does the production schedule reflect the Law of Diminishing Returns? (Hint:Correct answer isyes)5-353535
