Imagine a society that produces Capital goods and consumer goods.Draw a production possibilities frontier for capital and consumer goods. Explain why it most likely has a bowed-out shape.Show a point that is impossible for the economy to achieve. Show a point that is feasible but inefficient.Imagine that the society has two political parties, party A (who wants capital goods) and the party B (who want a consumer goods). Show a point on your production possibilities frontier that the part A might choose and a point the party B might choose.Imagine that our progressive neighboring country reduces the size of its consumer goods. As a result, both the Party A and B reduce their desired production of consumer goods by the same amount. Which party would get the bigger “technology dividend,” measured by the increase in capital production? Explain.

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Answered: Imagine a society that produces Capital…

Survey Of Economics

10th Edition

ISBN:9781337111522

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter2: Productions Possibilities, Opportunity Costs, And Economic Growth

Section: Chapter Questions

Problem 6SQP

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Imagine a society that produces Capital goods and consumer goods.

Draw a production possibilities frontier for capital and consumer goods. Explain why it most likely has a bowed-out shape.
Show a point that is impossible for the economy to achieve. Show a point that is feasible but inefficient.
Imagine that the society has two political parties, party A (who wants capital goods) and the party B (who want a consumer goods). Show a point on your production possibilities frontier that the part A might choose and a point the party B might choose.
Imagine that our progressive neighboring country reduces the size of its consumer goods. As a result, both the Party A and B reduce their desired production of consumer goods by the same amount. Which party would get the bigger “technology dividend,” measured by the increase in capital production? Explain.

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