Reference no: EM13832519
Refer to Figure 5-1 at the textbook (9th edition). The numerical example with no factor substitution that leads to the production possibility frontier in Figure 5-1.
What is the range for the relative price of cloth such that the economy produces both cloth and food? Which good is produced if the relative price is outside of this range?
Write down the unit cost of producing one yard of cloth and one calorie of food as a function of the price of one machine-hour, r, and one work-hour, w. In a competitive market, those costs will be equal to the prices of cloth and food. Solve for the factor prices r and w.
What happens to those factor prices when the price of cloth rises? Who gains and who loses from this change in the price of cloth? Why? Do those changes conform to the changes described for the case with factor substitution?
Now assume that the economy’s supply of machine-hours increases from 3,000 to 4,000. Derive the new production possibility frontier.
How much cloth and food will the economy produce after this increase in its capital supply?
Describe how the allocation of machine-hours and work-hours between the cloth and food sectors changes. Do those changes conform with the changes
|
Socially beneficial outcomes is talking utter nonsense
: "Anyone who tells you that markets left to their own devices always lead to socially beneficial outcomes is talking utter nonsense." Do you agree with this statement? Defend your position.
|
|
Write the revenue r as a function of number of units sold
: write the revenue R as a function of number of units sold
|
|
Asian sweatshops is that there are not enough of them
: Wheelan (in Naked Economics) states that "the problem with Asian sweatshops is that there are not enough of them." How is Wheelan's statement illustrative of the concept that every market transaction makes all parties better off?
|
|
Write a report which analyses system test evaluation
: Write a report which critically analyses the system test evaluation and validation of a project , Optimisation in design and operations for reliability and maintainability which you have developed in assignment.
|
|
Economy produce after this increase in its capital supply
: What is the range for the relative price of cloth such that the economy produces both cloth and food? Which good is produced if the relative price is outside of this range? Write down the unit cost of producing one yard of cloth and one calorie of fo..
|
|
Compare your nchl leadership competency levels
: Create a visual diagram, matrix, illustration, or concept map to: Define your personal statements. Compare your NCHL leadership competency levels. Define your chosen organization's statements and values (such as, vision, mission, values, ethics codes..
|
|
Which of the following describe chemical properties
: Which of the following describe chemical properties
|
|
Global business strategies
: Select a region and choose a trading bloc (NAFTA, EU, ASEAN, etc.) within that region. In a single paper write two 350- to 500-word articles, one article in favor of regional integration and another article against regional integration. Describe the ..
|
|
Different levels in maslows hierarchy for parts of life
: Consider which stage of Maslow's Hierarchy of Needs you are most likely in that drives a lot of your purchase decisions. Are those purchases consistent with this stage? As noted in the topic, a person could be at different levels in Maslow's Hierarch..
|