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To the right is a production possibilities table for consumer goods (automobiles) and capital goods (forklifts): a. Show these data graphically. Upon what specific assumptions is this production possibilities curve based? b. If the economy is at point C, what is the cost of one more automobile? 2/9 of a forklift Of one more forklift? Which characteristic of the production possibilities curve reflects the law of increasing opportunity costs: its shape or its length? c. If the economy characterized by this production possibilities table and curve were producing 3 automobiles and 20 forklifts, what could you conclude about its use of its available resources? d. Is production at a point outside the production possibilities curve currently possible? Could a future advance in technology allow production beyond the current production possibilities curve? Could international trade allow a country to consume beyond its current production possibilities curve?
What is Real GDP To be able to make reasonable comparisons of GDP over time, we must adjust for inflation. For instance, if prices are doubled over 1 year then GDP would doubl
1. Given the following production function: Y = K1/4 L3/4 Find the following: a. Per worker production function. b. Steady-state capital-labor ratio as a function of d and
Suppose that quantity demand falls by 30% as a result of a 5% increase in price. What would be the price elasticity of demand for this good?
Suppose three identical firms are engaged in Cournot competition in quantities. They all have marginal costs equal to 40. Market demand is given by: P(X) = 200 - X = 200 - (x
In the keynesian cross model, assume the consuption function is given by C=200=.75(Y-T) and planned investment=100, government purchases and taxes are each of them 100. a) Draw a g
what are the causes of inflationary gap
what measures should be taken to raise the productivity of the workers?
Give an example of a current event opportunity cost that includes graphs
Norms influence behavior conformity among group members. What factors will influence group members to conform to a group's norms, and when will members remain independent? Do indiv
Marginal Propensity to consume or known as (MPC) relates to a change in net or total consumption expenditure to a change in the total disposable income. Symbolically it is writt
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