|2. Explain how each of the following situations would affect a nation's productionpossibilities curve.a. A technological innovation allows the nation to more efficiently convert solar energyinto electricity.b. A prolonged recession increases the number of unemployed workers in the nation.c. A category 5 hurricane destroys over 40 percent of the nation's productive capacity.d. The quality of education in the nation's colleges and universities improves greatly.

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Answered: 2. Explain how each of the following…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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2-2b Suppose that Canada produces only lumber and fish. It has 18 million workers, each of whom can cut 10 feet of lumber or catch 20 fish daily. 4. What is the opportunity cost of producing 1 foot of lumber? 5. Use your graph to determine how many fish can be caught if 60 million feet of lumber are cut.
8. Economic growth The following graph shows the production possibilities curve (also known as the production possibilities frontier) of an economy that produces cars and computers. Suppose that a rise in this economy's saving rate allows for investment in modern, efficient manufacturing plants. Adjust the production possibilities curve (PPC) to show the economy's new production possibilities after the rise in the saving rate. 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. QUANTITY OF CARS (Mor) 24 PPC 5 10 QUANTITY OF COMPUTERS (Mor) 15 Suppose society faces a broad tradeoff between allocating resources to the production of investment goods (computers) and consumption goods (cars) before the rise in the saving rate described above. Which of the following events…
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When economic growth occurs, the production possibilities frontier shifts outward but no longer limits the amount that can be produced. economy moves along its production possibilities frontier. production possibilities frontier shifts outward. production possibilities frontier becomes steeper.
1. What is the opportunity cost of a particular product? The price paid for that product. b. The value put on that product by the person who bought it. c. The value of the next-best alternative that is given up as a result of buying that particular product. d. The combined value of all the other alternatives that are given up as a result of buying that particular product. a. 2. Which of the following is a capital good? An oven in a bakery. b. A home computer. a. c. The first application of CD ROM technology to an economics textbook. d. An investment in IBM stock.
3. Opportunity Cost Frances and Latasha are roommates. They spend most of their time studying (of course), but they leave some time for their favorite activities: making pizza and brewing root beer. Frances takes 4 hours to brew a gallon of root beer and 2 hours to make a pizza. Latasha takes 6 hours to brew a gallon of root beer and 4 hours to make a pizza. Frances's opportunity cost of brewing a gallon of root beer is and Latasha's opportunity cost of brewing a gallon of root beer is has an absolute advantage in brewing root beer, and has a comparative advantage in brewing root beer. If Frances and Latasha trade foods with each other, will trade away pizza in exchange for root beer. The price of pizza can be expressed in terms of gallons of root beer. The highest price at which pizza can be traded that would make both roommates v of root beer per pizza. better off is of root beer, and the lowest price that makes both roommates better off is…
3. Opportunity Cost Ana and Dina are roommates. They spend most of their time studying (of course), but they leave some time for their favorite activities: making pizza and brewing root beer. Ana takes 3 hours to brew a gallon of root beer and 2 hours to make a pizza. Dina takes 7 hours to brew a gallon of root beer and 5 hours to make a pizza. Ana's opportunity cost of brewing a gallon of root beer is , and Dina's opportunity cost of brewing a gallon of root beer is . has an absolute advantage in brewing root beer, and has a comparative advantage in brewing root beer. If Ana and Dina trade foods with each other, will trade away pizza in exchange for root beer. The price of pizza can be expressed in terms of gallons of root beer. The highest price at which pizza can be traded that would make both roommates better off is of root beer, and the lowest price that makes both roommates better off is of root beer per pizza.
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1. Explain the Malthusian trap using graphs. 2. Is technological progress enough to free an economy from the Malthusian trap? Use graphs to answer the question.
Question 1 a. Draw a production possibilities curve for a hypothetical economy producing capital goods and consumer goods Tlhustrate economic growth and 1use (A) to represent an inefficient b. Explain the law of increasing opportunity cost. c. Explain why scarcity forces individuals and society to incur opportunity costs. Give three (3) specific examples.

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