Consider graph PPC2 above.Assume the initial PPC has intercepts at points F and E. What might cause theeconomy to produce at point G (without having the PPC shift in)?Supporting MaterialsCapital goods800550FGBH1,100 1,300Consumer goodsan earthquake that destroys many factoriesunemployment of laborit is not possible for the economy to be at point Ga fall in demand for consumer goods

A curve that illustrates the most goods and services (here, capital and consumer goods) an economy…

Consider graph PPC2 above. Assume the initial PPC has intercepts at points F and E. What might cause the economy to produce at point G (without having the PPC shift in)? Supporting Materials Capital goods 800 550 0 A F B H 1,100 1,300 Consumer goods unemployment of labor an earthquake that destroys many factories E it is not possible for the economy to be at point G a fall in demand for consumer goods

Consider graph PPC2 above. Assume the initial PPC has intercepts at points F and E. What might cause the economy to produce at point G (without having the PPC shift in)? Supporting Materials Capital goods 800 550 0 A F B H 1,100 1,300 Consumer goods unemployment of labor an earthquake that destroys many factories E it is not possible for the economy to be at point G a fall in demand for consumer goods

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter13: General Equilibrium And Welfare

Section: Chapter Questions

Problem 13.1P

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Line XX is the production possibility curve (PPC) of a worker picking peas and beans in a 10 hour working day. (The graph for this question is attached below) What would cause the worker's PPC to shift to the line YY? A. a machine that increases the worker's pea picking productivity only B. a new work schedule where the worker spends 6 hours per day picking peas and only 4 hours picking beans C. a reduction in working hours to 8 per day and a machine that increases the worker's pea picking productivity D a reduction in working hours to 8 per day only
Assume a country produces haircuts and shirts with inputs of labour. The country has 100 hours of labour available. A haircut requires 30 minutes of labour, while a shirt requires 2 hours of labour. Solvve sub-parts as well. a. Construct country’s production- possibility frontier. b. Suppose there is an increase in the labour hours from 1,000 to 1,500 labour hours. Indicate on the PPF how it will impact the production, if at all and brief explain why?
1. Discuss any five factors that may cause production possibility frontier (PPF) curve to shift.
a) What will the value of the PPF/PPC be in a two factor model with L=Labor along the horizontal axis, and K=Capital along the vertical axis? Explain b) Look at a country’s Terms of Trade (T.O.T.). It is assumed that when the T.O.T. value increases the country’s wellbeing goes up, and when the T.O.T. value declines, the country’s wellbeing is reduced. Explain.
The accompanying Production Possibilities Frontiers (PPF) represent hypothetical levels of production for Honduras and Brazil. Assume the two countries are initially producing and consuming in autarky at point A on each of their PPFs. Suppose these countries decide to trade. Each country will specialize in the production of the good for which it has a comparative advantage. a. What will each country produce? a. Honduras will produce both goods. b. Brazil will produce both goods. c. Honduras will produce bananas and Brazil steel. d. Honduras will produce steel and Brazil bananas. b. Suppose each country specializes in the production of the good for which it has a comparative advantage, and they trade at a price of of 4,000 tons of steel for 6,000 tons of bananas. Place the points labeled "Post Trade Consumption" to show the amounts of bananas and steel each country will have to consume after they trade. (look at image)
Cape Town and Durban were first developed in the 17th and 18th centuries as trading posts on theshipping route between Western Europe and Asia. During the 19th century, this role changed withthe discovery of diamonds and gold in the interior. The port cities developed from being stop-overand service points providing shipping services, to being ports through which commodities weretraded.”The change in the that occurred in the Durban and Cape Town ports during the 19th century is best explained by…a) A movement along the production possibilities frontier.b) A movement towards the production possibilities frontierc) An outward movement of the production possibilities frontierd) An inward movement of the production possibilities frontier
1.Under what conditions is the production possi bilities frontier linear rather than bowed out? 2.Explain how absolute advantage and compara-tive advantage differ. 3.Give an example in which one person has anabsolute advantage in doing something butanother person has a comparative advantage. 4.Is basoute advantage or comparative advantage more important for trade? Explain yourreasoning using the example in your answer toQuestion 3..If two parties trade based on comparativeavantage an ot gain, in wat range mustthe price of the trade lie?.Will a nation tend to export or import goods forwhich it has a comparative advantage?
The table below presents production schedule of apples and bananas in the country of mistania - assume that these are the only two goods that Mistania produces. Each row represents a specific set of apples and bananas that Mistania could produce. Suppose Mistania was currently at Senario C, producing 10 bananas and 80 apples. According to the data in this table, if Mistania wanted to produc 1 more banana, how many fewer apples will it need to produce? Scenario Bananas Apples A 0 100 B 5 90 C 10 80 D 15 70 E 20 60
pics is just for reference i need Q20 solution Question 20 Refer to Table 1-1 in Question 11 and your answers to questions 11-18. (Same scenario as Q 19) Assume that Derryland and Whetonia each has 40 labor hours available and that there is no trade. Each country consumes what it produces. Assume now that, without trade, Derryland spent 28 hours producing cheese and the remaining 12 hours producing bread. Whetonia spent 20 hours producing cheese and 20 hours producing bread. What is the total output of BREAD produced by both countries combined?
Suppose two economies Home (H) and Foreign (F) produce two goods, bread and wine, with only one production factor: labour. Production technology, expressed as marginal product of labour (MPL), is given in the following table: Technologies expressed as MPL Bread Wine Home 1/6 1/12 Foreign 1/4 1/2 Suppose that Home has 2400 units of labour and Foreign has 1800 units of labour. a. ) Derive the Production Possibilities Frontier (PPF) and the Consumption Possibility Frontier (CPF) for Home and Foreign, with bread on the horizontal axis and wine on the vertical axis. What is the autarky equilibrium price of bred relative to wine in each country? b.) What country has the absolute advantage in producing each good? What country has the comparative advantage in producing each good? Briefly explain the difference between these two concepts. Suppose both countries are now free to trade. The world relative price of bread is 1. c. What is the pattern of specialisation and trade?…
Assume 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.Production in this economy is subjected to the law of diminishing marginal returns and resourcesare assumed to be fully optimized. In addition, the cost of sacrificing shoes for computers andvice versa is 1. On the basis of the foregoing assumptions, answer the following questions: What happens to the PPF when the economy discovers an improved technology for producing shoes?
Suppose the hypothetical economy produces only car and oil using its available resources and existing technology. CombinationsUnitsProduction alternatives ABCDE OilKgs8006004002000 CarNumber0500100015002000 Using the above information, Draw the production possibility frontier/ curve of a nation.If the economy is initially operating at point C, then calculate the opportunity cost producing one more unit of car. What changes are required for the economy to shift PPF either outward or inward?