Economics (Book Only)
12th Edition
ISBN: 9781285738321
Author: Roger A. Arnold
Publisher: Cengage Learning
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Chapter 2, Problem 2QP
(a)
To determine
Explain how scarcity is represented in
(b)
To determine
Explain how the choices are represented in PPF.
(c)
To determine
Explain how the
(d)
To determine
Explain how the productive efficiency is represented in PPF.
(e)
To determine
Explain how the
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Which of the following statements is incorrect regarding the PPF model?
a. A decrease in resource availability would cause the PPF to shift in closer to the origin.
b. Points that are currently outside of the PPF could be attainable with increased resource availability and/or improved technology.
c. The points on the PPF where the curve touches the axes are clearly the best ones for the firm to produce.
d. If the goods sector of an economy is being studied, the axes will be labeled consumer (or consumption) goods and capital goods.
e. If an entire economy is being studied, the axes will be labeled goods and services.
Using a production possibilities frontier (PPF) diagram, determine how does the PPF change in response to the events describe below.
a) A relaxation of policies allowing more foreign direct investment into the country. b) Increasing the minimum wage level. c) A decrease in expenditure on research and development. d) An increase in the retirement age. e) Government policies supporting the provision of services, without affecting manufacturing.
a) Why is the PPF curve bowed outward. Is it due to increasing opportunity cost or decreasing opportunity cost or constant opportunity cost
Type and answer using only one of the underlined words above
b) What happens to the PPF curve during a recession? Will it shift inward or outward or remains constant
Type and answer using only one of the underlined words above
c) Suppose a technology is banned due to its adverse environmental impacts. Would the production possibilty curve shift inward or outward or remain
constant due to this
Type and answer using only one of the underlined words above
d) How will a policy encouraging more immigration would shift the production possibility forntier. It will shift inward or outward or remain constant
Type and answer using only one of the underlined words above
Chapter 2 Solutions
Economics (Book Only)
Ch. 2.1 - Prob. 1STCh. 2.1 - Prob. 2STCh. 2.1 - Prob. 3STCh. 2.1 - Prob. 4STCh. 2 - Prob. 1VQPCh. 2 - Prob. 2VQPCh. 2 - Prob. 3VQPCh. 2 - Prob. 4VQPCh. 2 - Prob. 5VQPCh. 2 - Prob. 1QP
Ch. 2 - Prob. 2QPCh. 2 - Prob. 3QPCh. 2 - Prob. 4QPCh. 2 - Prob. 5QPCh. 2 - Prob. 6QPCh. 2 - Prob. 7QPCh. 2 - Prob. 8QPCh. 2 - Prob. 9QPCh. 2 - Prob. 10QPCh. 2 - Prob. 11QPCh. 2 - Prob. 12QPCh. 2 - Prob. 1WNGCh. 2 - Prob. 2WNGCh. 2 - Prob. 3WNGCh. 2 - Prob. 4WNGCh. 2 - Prob. 5WNGCh. 2 - Prob. 6WNGCh. 2 - Prob. 7WNGCh. 2 - Prob. 8WNGCh. 2 - Prob. 9WNG
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Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Similar questions
- As an economy grows, A) its PPF shifts outward. B) the opportunity cost of production will approach 0. its PPF does not shift; instead, the production point moves from inside the PPF to be closer to the PPF. D) it can eliminate scarcity. E) the opportunity cost of production will increase.arrow_forwardUse the diagram below uploaded to answer the questions that follow. (a) What change could cause the PPF to shift from the original curve (HJ) to the new curve (MN)? (b) Under what conditions might an economy be operating at point Z? (c) Why might a government implement a policy to move the economy from Point V to Point W?arrow_forwardUse the PPF to answer the following questions: (a) At point F, how many sweaters are being produced? How many hard drives? (b) Label points A-H as either efficient, inefficient, or unattainable. (c) Can we determine if point F is productively efficient? If so, is it productively efficient? (d) Can we determine if point F is allocatively efficient? If so, is it allocatively efficient?arrow_forward
- Macroeconomics Basics What is a production possibilities frontier (PPF)? Illustrate (DRAW) your answer by drawing a PPF, properly labeled and show an unattainable production combination.arrow_forwardIn a production possibilities frontier graph, the cost of producing more units of a good is measured by the A) dollar value of the resources used to produce the good. B) amount of the other good or service that must be forgone. dollar value of the additional output. area in the arc between the PPF and a straight line drawn between the starting point and the ending point. E) None of these answers is correct.arrow_forwardThe production possibilities frontier (PPF) is a simplified economic model that illustrates the different combinations of two products that an economy can produce given the resources it has available. Assume the country of Turkey can produce only apples or oranges and answer each of the following questions A if a flood destroyed 20% of the farmland used to grow apples and oranges, which direction will Turkey's PPF shift /your answer should be "outwards" or "inwards") and why? B. Turkey decides to begin increasing, the production of oranges. Explain the implications of this using the term "opportunity cost" C An advancement in organic pesticide has allowed for less fruit to be damaged by pests. Explain how this change would alter the PPF.arrow_forward
- Use the diagram attached to answer the questions that follow. (a) What change could cause the PPF to shift from the original curve (HJ) to the new curve (MN)? (b) Under what conditions might an economy be operating at point Z? (c) Why might a government implement a policy to move the economy from Point V to Point W?arrow_forwardWhy is the Production Possibility Curve (PPC) or Production Possibility Frontier (PPF) concave? What does increasing opportunity costs mean? When we increase production, why does it seem that we have to sacrifice more and more resources?arrow_forwardExplain how each of the following situations would affect a nation’s production possibilities curve (i) A global pandemic results in 6 million confirmed cases and the death of over 400,000 individuals What happens to PPF Explanation (ii) A switch to online delivery, increases access to education in the nation’s colleges and universities but might have a detrimental impact on the quality of education. What happens to PPF Explanationarrow_forward
- Using the graph below, use the production possibilities curve/ frontier PP1 curve to answer the question following the graph. Capital goods PPP Consumer goods Which point(s) on the above graph relative to PP1 curve, represent(s) maximum possible output and therefore productive technical efficiency? A B A, B, C Darrow_forwardanswer quicklyarrow_forwardHelp! The question is to Explain how the following situation would affect a nation's production possibilities curve. A category 5 hurricane destroys over 40% of the nation's productivity. The two questions are What happens to PPF and an explanation. The options for both are in the drop down.arrow_forward
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