9. Draw a PPF curve for the macroeconomy of Germany (a large producer of capital goods). Assume that Germany has an unemployment rate of 7%. (Hint: draw the dashed line assuming a full employment level of 4.5% unemployment rate and consider only consumption and capital goods in the economy.)
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- 8. (Shifting Production Possibilities) Determine whether each of the following would cause the national economy’s PPF to shift inward, outward, or not at all: a. An increase in the average length of annual vacations b. An increase in immigration c. A decrease in average retirement-aged. The migration of skilled workers to other countriesCovid -19 increases the number of unemployed workers in nation. What happens to the PPF curve? Also, from the list provided, please choose an explanation as to why you chose your previous answer. What happens to the PPF? Explain. Choose: PPF shifts outwards Produce inside PPF Produce outside PPF Increased production given resources Increase in resources PPF shifts inwards Unused ResourcesAssume an economy producing only two goods (shoes and computers) with a fixed amount of productive resources and technology and employing all its productive resources to the maximum. The maximum output combinations of both goods are given in the table below: Combination Shoes Computers Shoes Computers A 0 1000 B 100 900 C 200 750 D 300 550 E 400 300 F 500 0 Draw the PPF using your knowledge about the shape and slope of PPC. I Does the PPF have the expected shape? iii. Explain why your PPF in (a) above depicts that shape. How many computers could society produce if it was willing to do without shoes? Why are points outside the frontier unattainable? Identify three ways by which the economy can attain the level of production outside the PPF. vii. What happens…
- Course: Macroeconomics Assume that one day's labor in Argentina can produce either 20 units of cloth or 2 units of wine, while in Chile one day's labor can produce either 24 units of cloth or 12 units of wine. Question: What would you suggest each of these countries produce? Explain your answer. (Make sure to include the amount of cloth and amount of wine each country should produce.)In 2018, sizeable lithium deposits were discovered in Germany. Suppose that prior to the discovery of new lithium deposits, Germany was operating on its PPF. The discovery of new lithium deposits in Germany _____. After this discovery, if Germany's production did not change, Germany would be operating _____. -SHIFTED Germany's PPF; efficiently -moved Germany ALONG its PPF; inefficiently -SHIFTED Germany's PPF; inefficiently -moved Germany ALONG its PPF; efficientlyDraw a PPF graph for a farm producing two products (RICE & WHEAT) that illustrates increasing opportunity cost and show: a) Show how this PPF graph will change when a technological progress happens in the production of both products? b) Show how this graph will change when this PPF graph shift inwards? And what could be the reason for this PPF graph to shift inwards?
- Suppose the economy initially produces 15,000 gallons of drinking water and 400,000 tons of steel, which is represented by point A. The opportunity cost of producing an additional 5,000 gallons of drinking water (that is, moving production to point B ) is tons of steel. Suppose, instead, that the economy currently produces 336,000 tons of steel and 20,000 gallons of drinking water, which is represented by point B. Now the opportunity cost of producing an additional 5,000 gallons of drinking water (that is, moving to point C ) is tons of steel. Comparing your answers in the two previous paragraphs, you can see that the opportunity cost of 5,000 additional gallons of drinking water at point B is the opportunityQ1. What is the difference between Straight line PPF and bowed outward PPF?Figure 2 shows the PPF for an economy that produces Butter and Guns. What is the maximum amount of butter that the economy can produce if it allocates all of its resources for the production of butter? A) 0 B) 10,000 C) 30,000 D) 50,000
- Question 1Using a production possibilities frontier (PPF) diagram, determine how does the PPF change in response to the following events: Make sure to explicitly indicate what sectors you are representing, and what sort of assumptions each event implies (i.e., a neutral effect vs a sector-biased effect). The latter follows from your assumptions on the factor intensity of the sector you are representing. a) Increasing skilled migration into the countryb) Imposing taxes on manufacturing (hint: define a two-sector producing economy, manufacturing and services).c) Decreasing the expenditure on research and developmentd) Implementation of easier rules for foreign investmente) The effects of a pandemic Question 2 Identify what sort of effects the following listed events have. You are required to define the market under study (for example: the labour market, oil market, etc). Explain whether the event acts on the demand or supply side, and whether the event leads to a quantity or…Why does this PPF have a bowed-out shape? How can the economy increase its production of both tea and snacks? Graph the PPF with and show an increase in its production.Meanwhile, in the country of Portugal, wool and wine can also be produced according to a linear PPF. However, when all resources are devoted to production of wine, Portugal can produce 100 barrels, but when all resources are devoted to wool production, portugal can produce 50 bushels. What are the opportunity costs in Portugal of producing a barrel of wine?
