Production Possibility Frontier ( Ppf ) Essay

Many businesses consist with constant decision makings. It can be a group decision making or such as an individual decision making. Microeconomics is the part of economics concerned with single factors and the effects of individual decisions. Business take use of microeconomics data to make multiple of different choices, which could determine the success or failure of their business. Microeconomics is the reliability and currency of the information a business uses, therefore, is usually the most important strategy that the company or enterprise relies on when things get difficult or just wanting to grow their business taking a risk.

Opportunity cost, a choice that is the value of the next best alterternative given up when a choice is made, is a solid decision making technique because the choices being made can be equally compared for greater satisfaction in a decision. Opportunity cost can be used in a multitude of different situations where choices must be made. For example, a teenage girl wants to see the latest romantic comedy at the cinema with her friends, but the teenage girl has an important chemistry test the next day. By using opportunity cost the teenage girl has the option of thinking about what her best alternatives are. If the teenage girl goes to see the romantic comedy she will get to hang out with her friends and see the latest romantic comedy, but is the

I disagree with the following assertion because it does not add up with what microeconomics and macroeconomics actually does. Microeconomics, while it is concerned with why things happen in a specific place, it does not deal with the unemployment rate, that is macroeconomics. Macroeconomics does deal with the economy in the country as a whole, but it does not deal with the dealing how the rate of teenage smoking would be affected by increasing taxes on cigarettes. Dealing with the way a change in prices affects the buying and selling of that product is microeconomics.

Macroeconomics is the study of economics as a whole and it affects everyone. It affects us all in the way it helps us make decisions. Issues like inflation, which can reduce the value of our savings or unemployment affect us everyday. As consumer we want to know the cost of good or how much borrowing money might cost. Businesses want to know if it's the right environment to introduce a product at a certain price. Even the government turns to macroeconomics to figure out such things as creating

Beyond the PPF line, point ‘E’ is unattainable because resources are limited to get the further outcome. At point ‘D’, the resources are not utilized fully which will creates the situation of unemployment, less economic growth and many other economic impact. Any point inside the PPF line is inefficient as either resources are not used fully or misallocated.

Two costs related to opportunity costs are explicit and implicit costs. Explicit costs is the direct monetary payment or expense that a producer incurs by choosing one option over another. For example, a firm incurs $1000 as wages for workers when it decides to produce steel pans instead of cast-iron pans and this $1000 is considered as the explicit opportunity cost for the production of steel pans. Implicit costs, on the other hand, are those that cannot be measured directly and do not involve any monetary payments. A good example is when someone chooses between working and staying at home for personal reasons. The implicit opportunity cost is the salary that is lost by not working and staying at home to pursue a passion.

Macroeconomics is the study of income and production on the national level. The economic problems of nations around the world are constantly in the news. A keen understanding of macroeconomics is required to adequately comprehend the impacts a nation’s decisions will have on its economy. In the global market of today, a country’s decision can have impact on the economies of many other nations. Macroeconomics is focused on the operation of a nation’s economy as a whole, and there are many types of data available for analysis. Economists use unemployment rates and cost, Consumer Price Index (CPI) and inflation, the rate of government tax revenue and spending, and the Gross Domestic Product (GDP) to determine the long run success or failure of a nation’s economic strategy.

The macro environment deals with the external and uncontrollable factors of a business. The macro environment helps the business with identifying it’s triple bottom line and can help them adjust necessary factors in their planning. The macro environment also includes analyzing different factors in the external environment, In order for the business to take the current issues and create strategies of their own on how to eliminate them for the benefit of their business. The macro environment will look at factors such as inflation, unemployment, spending and the gross domestic product.

The Solow growth model states that a increase in capital accumulation and labour force will increase the economic growth rate, but only temporary because of diminishing returns.

Because microeconomics looks at individual transactions and small impacting originations making use of scarce resources. So saving in microeconomics may be good for the individual, however as macroeconomics looks at the bigger picture and looking at how the whole economy useless scarce resources. So in fact one thing may be good for someone, however it may not be good for someone else.

Micro economics is concerned with decision making on a small scale such as consumers, workers, businesses or firms and how they communicate with each and other and look at different markets at the same time.

Unlike microeconomics, macroeconomics concerns the economy as a whole. It evaluates those key issues like: inflation, GDP and employment rates. It deals with the structure and behaviour of the economy as a whole. Rather than considering the markets as individuals, people in the macroeconomic field develops models to analyse the correlation between consumption, output, inflation, and other international related indicators.

Micro environment in business is a specific area of elements which impact the organisation’s ability to serve its customers. Organisational micro environment factors consist of customers, competitors, suppliers, marketing and the general public. Macro environment is external factors of an organisation which are uncontrollable that influence in decision making and effects on performance and strategies. These include political, economic, social, technological and

Microeconomics is concerned on issues of an individual, such as firm, consumer, market and public sector organization (Wetherly and Otter, 2014). In addition, Microeconomics is related with millions of consumers and producers in free- market economy that works in decision making with regards to allocation of productive resources among thousands of goods and services (Chand, 2015). There are both theoretical and practical importances in Microeconomics which it helps economic policies promote the welfare of the masses (Chand, 2015).

Indifference curve- shows all the consumption points at which utility equals some constant. Each indifference curve is typically presumed to have a bowed shape.