Module 1 Case Assignment INTRODUCTION All economies have a production possibility curve and there any many different things that effect it. The removal of trade barriers or also known as free trade is not exempt from this list of things that affect an economies production possibility curve. Reduction in trade barriers can cause a country’s production possibility curve to shift outward. That is just one of many reasons that could cause an economy’s production possibility
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Considering the production of maize and shirts in Botswana‚ we can use the notion of the production possibilities curves to determine levels of efficiency‚ inefficiency‚ economic growth and technological improvement. The production possibilities curve (PPC) is a graph that shows the different quantities of the two goods (in this case‚ maize and shirts) that an economy (Botswana) could efficiently produce with the limited productive resources. To be able to illustrate this simply we assume that
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The Production Possibility Frontier Consider the case of an island economy that produces only two goods: wine and grain. In a given period of time‚ the islanders may choose to produce only wine‚ only grain‚ or a combination of the two according to the following table: Production Possibility Table Wine|Grain| (Thousand of bottles)|(Thousand of bushels)| 0|15| 5|14| 9|12| 12|9| 14|5| 15|0| The production possibility frontier (PPF)
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Explain how production possibility curves can be used to demonstrate the problem of unemployment‚ effects of technological change and the benefits of economic growth. Human wants are unlimited and resources are scarce. In order to satisfy these wants‚ all societies face the problem of allocating these scarce resources to producing the wanted products. These decisions greatly affect the economy and will contribute to the movements of growth. A graph that visually represents the results of the decisions
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2 Trade-offs‚ Comparative Advantage‚ and the Market System Chapter SOLUTIONS TO END-OF-CHAPTER EXERCISES Chapter 2 Answers to Thinking Critically Questions: 1. When BMW closes down a plant for alterations it incurs the direct cost of those alterations‚ but there is also an indirect opportunity cost. If BMW closes down the plant then that means the plant is not producing automobiles which could be sold. Therefore‚ BMW’s opportunity cost is the profits that it could have earned by operating the
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"Explain how production possibilities curves can be used to demonstrate the problem of unemployment‚ the effects of technological change and the benefits of economic growth."A production possibility frontier (also known as production possibility curve) represents all the possible combinations of the production of two types of goods and services that the economy can produce at any given time through graphical means. It is used to clearly demonstrate the problem of unemployment‚ the effects of technological
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CHAPTER 1 INTRODUCTION TO MICROECONOMICS 1. Which fundamental economic question requires society to choose the technological and resource mix used to produce goods? a. The what to produce question b. The why to produce question c. The how to produce question d. The for whom to produce question 2. A good or service that is forgone by choosing one alternative over another is called a (an): a. Explicit cost b. Opportunity cost c. Accounting cost d. Implicit
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Production Possibility Curve Name Academic Institution Class Professor Date Production Possibility Curve The production possibility curve (PPC) is defined as a theory that highlights the factors that limit a process the difficulties of making a choice‚ and the opportunity costs associated with making that decision (Hochstein‚ 2014‚ p. 343). Any time a decision is made by a manufacturer of a good‚ or a country making exports of goods to ready global buyers‚ the best decisions need
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area marked "WEBADVISOR ID". (This ID is the same ID that you use to get into your DBU email or into BlackBoard) Please select the best answer for each question given and fill in the respective answer option on the scantron for questions 1-40. Good luck! 1. Which of the following is not a positive economics statement? a. Prices of essential goods and services should be set by the government. b. Interest rates are lower this year than last year. c
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PRODUCTION POSSIBILITIES CURVE: A curve that illustrates the production possibilities of an economy--the alternative combinations of two goods that an economy can produce with given resources and technology. A production possibilities curve (PPC) represents the boundary or frontier of the economy’s production capabilities‚ hence it is also frequently termed a production possibilities frontier (PPF). As a frontier‚ it is the maximum production possible given existing (fixed) resources and technology
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