ESS OF ECON LL\AC 11E
11th Edition
ISBN: 9781264093083
Author: SCHILLER
Publisher: MCG
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Question
Chapter 1, Problem 7P
To determine
(a)
To calculate: The
To determine
(b)
To plot: The
To determine
(c)
The reason for more of both goods cannot be produced.
To determine
(d)
To find: The most desired point on the curve.
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Which of the following statements about the production possibilities curve is the most accurate?
OIt is a curve that shows the quantity of output that will be offered for sale at various prices.
It is a graph that shows the various combinations of output it is possible for an economy to produce given its
available resources and technology.
It is a graph that shows the combinations of output that are most profitable to produce.
It is a graph that shows the various combinations of resources that can be used to produce a given level of
output.
Shifts in production possibilities
Suppose South Africa produces two types of goods: agricultural and capital. The following diagram shows its current production possibilities frontier for barley, an agricultural good, and locomotives, a capital good.
Drag the production possibilities frontier (PPF) on the graph to show the effects of a breakout of avian flu that sickens millions of workers.
Note: Select either end of the curve on the graph to make the endpoints appear. Then drag one or both endpoints to the desired position. Points will snap into position, so if you try to move a point and it snaps back to its original position, just drag it a little farther.
Draw a production possibilities curve for food and clothing. If you are operating on the curve, what is the opportunity cost of producing more clothing? If you are on the curve, is it possible to increase production of one good without decreasing the production of the other?
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