Economics Word Problems: World War II

World War II Word Problems

Grade 11 Economics World War II Word Problems Challenging 5 Questions 9 Views

Classroom Worksheet

Economics Word Problems: World War II

World War II Word Problems

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Grade: Grade 11

Subject: Economics

Topic: World War II

Time: 20 Minutes

Difficulty: Challenging

Questions: 5

Instructions:
Solve each word problem using economic reasoning. Show your work clearly on your paper. Answer in complete sentences when asked. Use any reasonable assumptions if needed, and state them briefly.

Skills Practiced:

World War II
Economics
Critical Thinking
Problem Solving

1Question

During World War II, a factory could produce 500 civilian radios per month or 200 military communication units per month with the same workers and machines. If the factory chooses to produce 200 military units, what is the opportunity cost in terms of radios not produced?

2Question

A government sets a wartime price ceiling on wheat bread at $0.10 per loaf. At that price, consumers want 18,000 loaves per week and bakers are willing to supply 12,000 loaves per week. How large is the shortage each week?

3Question

A shipyard has a wartime budget of $4 million. Each cargo ship costs $800,000 to build, and each destroyer costs $1,200,000 to build. If the shipyard spends the entire budget on a mix of only cargo ships and destroyers, what is one possible combination of ships it could build? Give one combination and show that it uses the full budget.

4Question

A wartime economy produces 1,000 tanks in year 1. By year 2, output rises to 1,350 tanks because of better organization and more workers. If the value of each tank is estimated at $50,000, how much did the total value of tank output increase from year 1 to year 2?

5Question

A country reallocates labor during World War II. Before the war, 2 million workers produced consumer goods worth $8 billion per year. During the war, 1.2 million workers are shifted into war industries, and consumer goods output falls to $5 billion per year while war production adds $6 billion of military output. Based only on these numbers, what is the net change in total annual output, and what does this suggest about wartime production trade-offs?

Answer Key

#	Answer
1	The opportunity cost is 300 civilian radios per month, because producing 200 military units means giving up the 500 radios the factory could have made instead of the 200 military units.
2	The shortage is 6,000 loaves per week, found by subtracting quantity supplied (12,000) from quantity demanded (18,000).
3	One possible combination is 3 cargo ships and 1 destroyer. Cost: 3 × $800,000 = $2,400,000 and 1 × $1,200,000 = $1,200,000. Total = $3,600,000, so this does not use the full budget. A full-budget combination is 1 cargo ship and 3 destroyers: $800,000 + 3 × $1,200,000 = $800,000 + $3,600,000 = $4,400,000, which is too much. A correct full-budget combination is 6 cargo ships and 0 destroyers: 6 × $800,000 = $4,800,000, also too much. Since the costs are multiples of $400,000, a full-budget combination is 3 cargo ships and 2 destroyers: 3 × $800,000 = $2,400,000 and 2 × $1,200,000 = $2,400,000; total = $4,800,000, still too much. The correct full-budget combination is 0 cargo ships and 3 destroyers: 3 × $1,200,000 = $3,600,000, not full. A full-budget combination does not exist with whole ships and only these two costs because $4,000,000 is not reachable using 800,000 and 1,200,000 in whole-number combinations? Actually it is reachable: 5 cargo ships cost 5 × $800,000 = $4,000,000. So one possible combination is 5 cargo ships and 0 destroyers, which uses the full budget.
4	Year 1 value = 1,000 × $50,000 = $50,000,000. Year 2 value = 1,350 × $50,000 = $67,500,000. The increase is $17,500,000.
5	Before the war, total output was $8 billion. During the war, total output is $5 billion + $6 billion = $11 billion. The net change is an increase of $3 billion. This suggests that war production can raise measured total output even while consumer goods output falls, but the economy also faces a trade-off because fewer consumer goods are available.