Macroeconomics
13th Edition
ISBN: 9780134735696
Author: PARKIN, Michael
Publisher: Pearson,
expand_more
expand_more
format_list_bulleted
Question
Chapter 10, Problem 3SPA
(a)
To determine
The technologically efficient method.
(b)
To determine
The economically efficient method.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Refer to Ch. 6, Fig. 6.2 (The Effect of Technological Improvement) and Example 6.2 (Malthus and the Food Crisis)
Malthus believed that the world's limited amount of land would not be able to supply enough food as the population grew. As a result there would be mass hunger and starvation. But Malthus was proved wrong! Explain why Malthus' prediction about mass hunger and starvation did not come to pass.
1.
Briefly explain what the term "agglomeration economies" refers to and briefly describe what the fundamental reason for the development of this particular type of economy relates to. Provide two examples of factors associated with agglomeration economies and identify what these factors help to explain. Identify two factors that would lead to diseconomies and briefly explain how the future of many of the world's cities will be likely be determined.
2.
Describe the concept of diminishing returns in production. Explain why diminishing returns occurs.
In 1939, the box office records set by Gone with the Wind and The Wizard of Oz proved to Hollywood studios that investing in Technicolor was worth every penny. Nevertheless, a reversal of fortune hit the film industry as the United States entered World War II. Wartime shortages made celluloid nitrate more costly, so Hollywood studios reverted to primarily black and white. The few Technicolor musicals released only recovered their production costs. The graph shows Metro-Goldwyn-Mayer's (MGM) production of Technicolor movies before World War II. Modify the graph to describe the wartime period for MGM. Assume that nothing changes except the items discussed in the question.
Chapter 10 Solutions
Macroeconomics
Ch. 10.1 - Prob. 1RQCh. 10.1 - Prob. 2RQCh. 10.1 - Prob. 3RQCh. 10.1 - Prob. 4RQCh. 10.1 - Prob. 5RQCh. 10.2 - Prob. 1RQCh. 10.2 - Prob. 2RQCh. 10.2 - Prob. 3RQCh. 10.2 - Prob. 4RQCh. 10.3 - Prob. 1RQ
Ch. 10.3 - Prob. 2RQCh. 10.3 - Prob. 3RQCh. 10.4 - Prob. 1RQCh. 10.4 - Prob. 2RQCh. 10.4 - Prob. 3RQCh. 10.4 - Prob. 4RQCh. 10.5 - Prob. 1RQCh. 10.5 - Prob. 2RQCh. 10.5 - Prob. 3RQCh. 10 - Prob. 1SPACh. 10 - Prob. 2SPACh. 10 - Prob. 3SPACh. 10 - Prob. 4SPACh. 10 - Prob. 5SPACh. 10 - Prob. 6SPACh. 10 - Prob. 7SPACh. 10 - Prob. 8APACh. 10 - Prob. 9APACh. 10 - Prob. 10APACh. 10 - Prob. 11APACh. 10 - Prob. 12APACh. 10 - Prob. 13APACh. 10 - Technological and Economic Efficiency Use the...Ch. 10 - Prob. 15APACh. 10 - Prob. 16APACh. 10 - Prob. 17APACh. 10 - Prob. 18APACh. 10 - Prob. 19APACh. 10 - Prob. 20APACh. 10 - Prob. 21APACh. 10 - Prob. 22APACh. 10 - Prob. 23APA
Knowledge Booster
Similar questions
- Retune to Table 7.2. In the top half of the table, at what point does diminishing marginal productivity kick in? What about in the bottom half of the table? How do you explain this?arrow_forwardThe information on three different technologies named as q, v and x is listed in the table below. Note that all of these technologies use different combinations of two types of factors of production, labor and capital, to produce 1000 units of output. Consider the first scenario where the per unit prices of the inputs, labor and capital are $50 and $25 respectively. Technology No of Labors Capital (tons) Cost value ($) A 10 50 B 30 20 C 50 10 Now imagine that a discovery has been made which has led to labor advancements leading to a reduction in per unit price of labor to $10, ceteris paribus. Which technology will a typical firm adopt under these changed circumstances and why? Using the value of costs found, what is the value of the economic rent for this firm?arrow_forwardQ-How does profit motive affect innovation and economic productivity? (Pages 43 – 50). Profit Motive Leads to Innovation and Increased Productivity According to Bruno Leone (1986), “In order to build and maintain a profitable concern, a businessman’s products would have to be needed, well-made, and competitively priced . Moreover, he would be creating jobs and helping to expand the general economy” (18). Profit motive promotes efficiency and productivity in an economy. The investor is constantly seeking new ways to effectively and efficiently provide goods and services to consumer, because, Mises (1986) stated, “Profit and loss are entirely determined by the success or failure of the entrepreneur to adjust production to the demand of the consumers” (40). The behavior of the consumer makes profits and losses occur, and this can result in a change of ownership from those who are inefficient to the efficient ones. Webley (1967) stated, “The successful firms are those that respond to the…arrow_forward
- (1) The following table shows the production function for a firm. Number of workers Average productivity 1 6 2 8 3 9 4 9.25 5 9.30 6 9.32 Which worker represents the first decline in marginal productivity? A- 3rd. B-4th. C-5th D-6th. E- Productivity increases across the range given (2)A company hires workers to develop phone apps. The following table shows the marginal productivity of each worker. Number of Workers Marginal Product 1 8 2 9 3 10 4 10.5 5 9.75 6 9.5 What is the total product of employing the third worker? A- 1. B-9. C-10. D-27. E-30arrow_forwardH6. Your mother owns and runs an arts and craft store, and the business is doing well. She would have otherwise been employed as a high school geography teacher making $80,000 a year or as an interior decorator making $68,000 a year. She owns the building in which her shop is located, which she could have rented out for $24,000 a year. Her annual revenue from the shop is $430,000 and she employs four workers, each of whom earns $30,000 a year. On average, she spends $206,000 per year traveling, purchasing, and shipping unique merchandise for resale at her store. Based on this information, do you think you should encourage her to return to teaching? Explain your advice with the help of calculations on her opportunity costs, accounting profit, and economic profit.arrow_forward3 Explain how economies of scale can be a barrier to entry. Your initial post should be 3-4 paragraphs in length. Make sure to demonstrate critical thinking and analysis by using research. For full credit, include one journal article to support your pos t.t.arrow_forward
- 1. Explain the Theory of Production in Microeconomics. 2. Differentiate labor-intensive and capital-intensive technology. 3. Illustrate and discuss the 3 Stages of Production: Increasing Returns, Diminishing Returns, and Negative Returns.arrow_forwardHarvey quit his job at State University, where he earned $62,000 a year. He figures his entrepreneurial talent or forgone entrepreneurial income to be $4,000 a year. To start the business, he cashed in $50,000 in bonds that earned 10 percent interest annually to buy a software company, Extreme Gaming. In the first year, the firm sold 10,000 units of software at $72 for each unit. Of the $72 per unit, $60 goes for the costs of production, packaging, marketing, employee wages and benefits, and rent on a building. The economic profits of Harvey's firm in the first year werearrow_forward3. Understanding the least-cost rule Alex runs a surfing school on the North Shore of Oahu. He has two inputs: surfboards, which he rents from a local shop for $10 per day, and surfing instructors, whom he hires for $50 per day. Alex has figured out that the marginal physical product (MPP) of the last instructor hired is 15 lessons, and the MPP of the last board used is 2 lessons. Which of the following statements is correct? a. Alex could lower his costs without reducing his output if he employed fewer instructors and used more surfboards. b. Any of these answers may be right, depending on the price of a lesson. c. Alex currently employs a cost-minimizing combination of surfboards and instructors. d. Alex could lower his costs without reducing his output if he employed more instructors and used fewer surfboards.arrow_forward
- Power point ion Remember to give proper credit to your sources in a bibliography section. 1) Name of Economist 2) Their background 3) Economic Theory they presented or expanded or found problem with. Explain the theory. 4) Where did they work? 5) Other important contributions. etc. Remember to give proper credit to your sources in a bibliography section. 1) Name of Economist 2) Their background 3) Economic Theory they presented or expanded or found problem with. Explain the theory. 4) Where did they work? 5) Other important contributions. etc. Remember to give proper credit to your sources in a bibliography section. 1) Name of Economist 2) Their background 3) Economic Theory they presented or expanded or found problem with. Explain the theory. 4) Where did they work? 5) Other important contributions. etc. Remember to give proper credit to your sources in a bibliography section. 1) Name of Economist 2) Their background 3) Economic Theory they presented or expanded or found…arrow_forward2. What are the main sources of new-product ideas? (from Chapter 9)arrow_forwardWhat is a difference between technology businesses and other small businesses? Question 6 options: Technology businesses never start in garages, basements, kitchens, or dorm rooms, while some other types of small businesses can start in these places. Technology businesses have lower initial startup costs than other small businesses. Technology businesses require greater capital and have higher initial startup costs than other small businesses. Technology businesses are the only type of small business that uses technology. Technology businesses are less innovative than other small businesses.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Principles of Economics 2eEconomicsISBN:9781947172364Author:Steven A. Greenlaw; David ShapiroPublisher:OpenStax
Principles of Economics 2e
Economics
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:OpenStax