Draw a picture of a production possibilities frontier curve. identify each axis as measuring either guns or butter. select and label point a, which is beyond the economy's ability to produce; point b, which represents an inefficient level of production; point c, an efficient combination of output in which more guns are produced than units of butter; and point d, an efficient production point in which more units of butter are produced than guns. be sure to label each clearly.

Rate of return douglas keel, a financial analyst for orange industries, wishes to estimate the rate of return for two similar-risk investments, x and y. douglas's research indicates that the immediate past returns will serve as reasonable estimates of future returns. a year earlier, investment x had a market value of $27 comma 000; and investment y had a market value of $46 comma 000. during the year, investment x generated cash flow of $2 comma 025 and investment y generated cash flow of $ 6 comma 770. the current market values of investments x and y are $28 comma 582 and $46 comma 000, respectively. a. calculate the expected rate of return on investments x and y using the most recent year's data. b. assuming that the two investments are equally risky, which one should douglas recommend? why?