ESSENTIALS OF ECONOMICS WITH CONNECT
11th Edition
ISBN: 9781266628146
Author: SCHILLER
Publisher: MCG
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Question
Chapter 2, Problem 1P
To determine
(a)
To determine
(b)
Change in production possibilities due to the increase in the production of investment goods.
To determine
(c)
Effect on production possibilities when only consumer goods are produced.
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What does a production possibilities graph show in economics?
how many items can be produced in a specific amount of time
possible production costs
one's final choice
one's top two choices when making a decision
8. Shifts in production possibilities
Suppose the United States produces two types of goods: agricultural and capital. The following diagram shows its current production possibilities
frontier for alfalfa, an agricultural good, and industrial copiers, a capital good.
Drag the production possibilities frontier (PPF) on the graph to show the effects of a breakout of avian flu that sickens millions of workers.
Note: Select either end of the curve on the graph to make the endpoints appear. Then drag one or both endpoints to the desired position. Points will
snap into position, so if you try to move a point and it snaps back to its original position, just drag it a little farther.
540
450
PPF
380
270
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90
PPF
100
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ALFALFA (Millions of bushels)
INDUSTRIAL COPIERS (Thousands)
Consider the graph. Suppose the economy is currently at a point E on the production possibilities curve producing a units of services and b units of goods. After technological development raises the maximum amount of goods that can be produced by the economy, the economy moves to point E', producing a' and b' units of services and goods respectively. Which of the following situation is possible? Select all that apply.
a. At E', a' = a and b' > b
b. At E', a' > a and b' = b
c. At E', a' > a and b' > b
d. At E', a' < a and b' > b
e. At E', a' < a and b' < b
Chapter 2 Solutions
ESSENTIALS OF ECONOMICS WITH CONNECT
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Similar questions
- many countries produce a single good upon which much of their economy depends. That good might be coffee or wool or oil. How might a production possibilities curve help economists in such a country determine how to diversify their economyarrow_forwardi need the answer quicklyarrow_forwardPlease give correct answer with proper grapharrow_forward
- 4. Shifts in production possibilities Suppose the fictional country of Olympia produces two types of goods: agricultural and capital. The following diagram shows its current production possibilities frontier for rye, an agricultural good, and microprocessors, a capital good. Drag the production possibilities frontier (PPF) on the graph to show the effects of a time-saving innovation in the manufacturing of microprocessors. Note: Select either end of the curve on the graph to make the endpoints appear. Then drag one or both endpoints to the desired position. Points will snap into position, so if you try to move a point and it snaps back to its original position, just drag it a little farther. ? MICROPROCESSORS (Thousands) 400 400 320 240 160 80 100 270 PPF W م PPFarrow_forwardWhich of the following statements about the production possibilities curve is the most accurate? OIt is a curve that shows the quantity of output that will be offered for sale at various prices. It is a graph that shows the various combinations of output it is possible for an economy to produce given its available resources and technology. It is a graph that shows the combinations of output that are most profitable to produce. It is a graph that shows the various combinations of resources that can be used to produce a given level of output.arrow_forward76arrow_forward
- 4. Shifts in production possibilities Suppose the United States produces two types of goods: agricultural and capital. The following diagram shows its current production possibilities frontier for wheat, an agricultural good, and cars, a capital good. Drag the production possibilities frontier (PPF) on the graph to show the effects of a time-saving innovation in the manufacturing of cars. Note: Select either end of the curve on the graph to make the endpoints appear. Then drag one or both endpoints to the desired position. Points will snap into position, so if you try to move a point and it snaps back to its original position, just drag it a little farther. 480 PPF 400 320 240 160 80 PPF 0. 90 180 270 360 450 540 WHEAT (Millions of bushels) CARS (Thousands)arrow_forwardShifts in production possibilities Suppose South Africa produces two types of goods: agricultural and capital. The following diagram shows its current production possibilities frontier for barley, an agricultural good, and locomotives, a capital good. Drag the production possibilities frontier (PPF) on the graph to show the effects of a breakout of avian flu that sickens millions of workers. Note: Select either end of the curve on the graph to make the endpoints appear. Then drag one or both endpoints to the desired position. Points will snap into position, so if you try to move a point and it snaps back to its original position, just drag it a little farther.arrow_forward3. Shifts in production possibilities Suppose the United States produces two types of goods: agricultural and capital. The following diagram shows its current production possibilities curve (also known as the production possibilities curve) for corn, an agricultural good, and airplanes, a capital good. Drag the production possibilities curve (PPC) on the graph to show the effects of an improvement in soil quality because of new fertilization techniques. Note: Select either end of the curve on the graph to make the endpoints appear. Then drag one or both endpoints to the desired position. Points vill snap into position, so if you try to move a point and it snaps back to its original position, just drag it a little farther. 420 350 PPC 280 210 140 70 + PPC 40 80 120 160 200 240 CORN (Millions of bushels) AIRPLANES (Thous ands)arrow_forward
- Suppose Canada produces two types of goods: agricultural and capital. The following diagram shows its current production possibilities curve (PPC) for wheat, an agricultural good, and industrial robots, a capital good. Drag the production possibilities curve (PPC) on the graph to show the effects of a breakout of a pandemic that sickens millions of workers. Note: Select either end of the curve on the graph to make the endpoints appear. Then drag one or both endpoints to the desired position. Points will snap into position, so if you try to move a point and it snaps back to its original position, just drag it a little farther. (?) INDUSTRIAL ROBOTS (Thousands) 420 350 280 210 140 70 0 40 PPC 80 120 160 WHEAT (Millions of bushels) 200 240 68 PPCarrow_forwardDraw a production possibilities curve for food and clothing. If you are operating on the curve, what is the opportunity cost of producing more clothing? If you are on the curve, is it possible to increase production of one good without decreasing the production of the other?arrow_forwardpart 3 4arrow_forward
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