PRINCIPLES OF MICROECONOMICS (LL)W/ACC.
7th Edition
ISBN: 9781264198733
Author: Frank
Publisher: MCG
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Chapter 2, Problem 5RQ
To determine
The effect of technological innovation on the
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Chapter 2 Solutions
PRINCIPLES OF MICROECONOMICS (LL)W/ACC.
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- How will a reduction in the number of hours worked each day affect an economy's production possibilities curve? How will technological innovations that boost labor productivity affect an economy's production possibilities curve?arrow_forwardThe following graph shows a production possibilities curve for a hypothetical country. Suppose that due to an increase in human capital, a country experiences economic growth. Adjust the following graph to show the effect of advances in human capital on the economy's production possibilities curve. Consumption goods PPC Capital goods 6 PPCarrow_forwardThe present choice between investing in capital goods and producing consumer goods now affects the ability of an economy to produce in the future?arrow_forward
- Graphically explain how each of the following events affects the location of a country's production possibilities curve: i. The quality of education increases. ii. The number of unemployed workers increases. iii. A new technique improves the efficiency of extracting copper from ore. iv. A devastating earthquake destroys numerous production facilities.arrow_forwardAnswer the following questions: 1) What is the production possibilities frontier? 2) Why do economists use models? 3) How does a society benefit from the production of capital goods? 4) What is the opportunity cost to the society of investing in the capital? 5) Why do economists consider the bowed production possibilities curve to be more realistic? 6) How can societies achieve economic growth?arrow_forwardWhat do you mean by the production possibilities of an economyarrow_forward
- Under what circumstances in the Philippines can we operate outside the production possibilities curve? Explain your answer.arrow_forwardhow does discovery of a new source of oil affects the production possibilities curve?arrow_forwardWhat does a Production Possibilities Curve depict? What is the Law of Demand? What components will cause a Shift in the Demand curve?arrow_forward
- Imagine two societies A and B with the production possibility curve shown in the diagram. In year t Society A produces only capital goods and Society B only butter In year t + 1 they both produce only butter. Which of the following describes both societies in year t + 1? A) A has a larger capital stock and A produces more butter. B) Both have the same capital stock but A produces more butter. C) Both have the same capital stock and both produce the same amount of butter. D) A has a larger capital stock but B produces more butter.arrow_forwardWhat can we learn from Malthusian Theory?arrow_forwardSuppose the Netherlands 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 alfalfa, an agricultural good, and cars, a capital good. Drag the production possibilities curve (PPC) on the graph to show the effects of an agricultural innovation that increases the crop yield of each hectare of land. 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 PPC 360 270 O 180 90 PPC 50 100 150 200 250 300 ALFALFA (Millions of bushels) CARS (Thousands)arrow_forward
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