Macroeconomics
13th Edition
ISBN: 9781337617390
Author: Roger A. Arnold
Publisher: Cengage Learning
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Question
Chapter 2, Problem 7WNG
To determine
Explain which points represent efficiency.
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Students have asked these similar questions
( a) why is the slop of PPF downward?
(b) why does the PPF look concave to the origin?
(c) What is positive economic analysis?
(a) If PPF₂ in the graph that follows is the relevant PPF, then which points are unattainable? Explain your answer.
(b) If PPF₁ in the preceding figure is the relevant PPF, then which point(s) represent productive efficiency? Explain your answer.
8. An individual's budget
Suppose Carlos has a yearly budget of $160 to spend on milk and cereal. Milk is priced at $4 per gallon, and cereal is priced at $2 per box.
If Carlos spends his entire $160 on milk, he can buy
CEREAL (Boxes)
Use the blue line (circle symbol) to plot Carlos's budget constraint on the following graph. Next, use the orange point (square symbol) to shade the area
that represents combinations of milk and cereal that are affordable for Carlos. Finally, place the black point (plus symbol) on the point on Carlos's budget
constraint that corresponds to a scenario in which Carlos spends $80 on each good.
Note: Dashed drop lines will automatically extend to both axes.
120
110
100
90
80
70
60
50
40
30
20
10
0
0 10 20 30
gallons of milk. If he spends his entire $160 on cereal, he can buy
40 50 60 70
MILK (Gallons)
80 90 100 110 120
BC, ($160)
Affordable Region
$80 on Each
boxes of cereal.
BC₂ ($200)
Chapter 2 Solutions
Macroeconomics
Ch. 2.1 - Prob. 1STCh. 2.1 - Prob. 2STCh. 2.1 - Prob. 3STCh. 2.1 - Prob. 4STCh. 2 - Prob. 1QPCh. 2 - Prob. 2QPCh. 2 - Prob. 3QPCh. 2 - Prob. 4QPCh. 2 - Prob. 5QPCh. 2 - Prob. 6QP
Ch. 2 - Prob. 7QPCh. 2 - Prob. 8QPCh. 2 - Prob. 9QPCh. 2 - Prob. 10QPCh. 2 - Prob. 11QPCh. 2 - Prob. 12QPCh. 2 - Prob. 13QPCh. 2 - Prob. 1WNGCh. 2 - Prob. 2WNGCh. 2 - Prob. 3WNGCh. 2 - Prob. 4WNGCh. 2 - Prob. 5WNGCh. 2 - Prob. 6WNGCh. 2 - Prob. 7WNGCh. 2 - Prob. 8WNGCh. 2 - Prob. 9WNGCh. 2 - Prob. 10WNGCh. 2 - Prob. 11WNGCh. 2 - Prob. 12WNG
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