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5. Capital investment in less-developed countries Aa Aa The following graph shows the production possibilities curves (PPCs) of two hypothetical countries, Anga and Panchal. Each economy produces only two sets of goods, consumer goods and capital goods. Although both countries had identical production capabilities in 2010, Panchal had a larger population and a greater need for consumer goods. In 2010, Panchal produced 60 million units of consumer goods and just enough capital to replace the existing capital that was worn out in that year. Anga produced only 50 million units of consumer goods and more than enough capital goods to replenish its depreciated capital. Assume that both countries produce efficient levels of output. On the following graph, use the black point (X symbol) to show the combination of goods that were produced in Panchal in 2010. Dashed drop lines will automatically extend to both axes. Then use the red point (cross symbol) to show the combination of goods that were produced in Anga in 2010. CAPITAL GOODS (Millions of units) 100 80 60 40 20 0 20 PPC of Both Countries 2010 Panchal Anga 40 60 100 CONSUMER GOODS (Millions of units) Help Clear All By producing capital goods over and above the amount necessary to replenish the stock of depreciated capital, an economy can increase its productivity. In this case, will experience greater economic growth in the future.

5. Capital investment in less-developed countries Aa Aa The following graph shows the production possibilities curves (PPCs) of two hypothetical countries, Anga and Panchal. Each economy produces only two sets of goods, consumer goods and capital goods. Although both countries had identical production capabilities in 2010, Panchal had a larger population and a greater need for consumer goods. In 2010, Panchal produced 60 million units of consumer goods and just enough capital to replace the existing capital that was worn out in that year. Anga produced only 50 million units of consumer goods and more than enough capital goods to replenish its depreciated capital. Assume that both countries produce efficient levels of output. On the following graph, use the black point (X symbol) to show the combination of goods that were produced in Panchal in 2010. Dashed drop lines will automatically extend to both axes. Then use the red point (cross symbol) to show the combination of goods that were produced in Anga in 2010. CAPITAL GOODS (Millions of units) 100 80 60 40 20 0 20 PPC of Both Countries 2010 Panchal Anga 40 60 100 CONSUMER GOODS (Millions of units) Help Clear All By producing capital goods over and above the amount necessary to replenish the stock of depreciated capital, an economy can increase its productivity. In this case, will experience greater economic growth in the future.

Essentials of Economics (MindTap Course List)
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter17: Production And Growth
Section: Chapter Questions
Problem 3PA
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PLEASE SHOW ME WHERE PANCHAL AND ANGA WOULD GO IN THE GRAPH, JUST LIKE THE QUESTIONS ASKS.THANK YOU VERY MUCH

 

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5. Capital investment in less-developed countries Aa Aa The following graph shows the production possibilities curves (PPCS) of two hypothetical countries, Anga and Panchal. Each economy produces only two sets of goods, consumer goods and capital goods. Although both countries had identical production capabilities in 2010, Panchal had a larger population and a greater need for consumer goods. In 2010, Panchal produced 60 million units of consumer goods and just enough capital to replace the existing capital that was worn out in that year. Anga produced only 50 million units of consumer goods and more than enough capital goods to replenish its depreciated capital. Assume that both countries produce efficient levels of output. On the following graph, use the black point (X symbol) to show the combination of goods that were produced in Panchal in 2010. Dashed drop lines will automatically extend to both axes. Then use the red point (cross symbol) to show the combination of goods that were produced in Anga in 2010. CAPITAL GOODS (Millions of units) 100 80 60 40 20 0 20 PPC of Both Countries 2010 Panchal Anga 40 60 80 100 CONSUMER GOODS (Millions of units) Help Clear All By producing capital goods over and above the amount necessary to replenish the stock of depreciated capital, an economy can increase its productivity. In this case, will experience greater economic growth in the future.
Transcribed Image Text:5. Capital investment in less-developed countries Aa Aa The following graph shows the production possibilities curves (PPCS) of two hypothetical countries, Anga and Panchal. Each economy produces only two sets of goods, consumer goods and capital goods. Although both countries had identical production capabilities in 2010, Panchal had a larger population and a greater need for consumer goods. In 2010, Panchal produced 60 million units of consumer goods and just enough capital to replace the existing capital that was worn out in that year. Anga produced only 50 million units of consumer goods and more than enough capital goods to replenish its depreciated capital. Assume that both countries produce efficient levels of output. On the following graph, use the black point (X symbol) to show the combination of goods that were produced in Panchal in 2010. Dashed drop lines will automatically extend to both axes. Then use the red point (cross symbol) to show the combination of goods that were produced in Anga in 2010. CAPITAL GOODS (Millions of units) 100 80 60 40 20 0 20 PPC of Both Countries 2010 Panchal Anga 40 60 80 100 CONSUMER GOODS (Millions of units) Help Clear All By producing capital goods over and above the amount necessary to replenish the stock of depreciated capital, an economy can increase its productivity. In this case, will experience greater economic growth in the future.
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