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Unformatted text preview: • After change it moves to 50,000 - (200/4) Q.D. (line from 50,000 to about 700) • What If Analysis • Assume gas prices double • Market research ﬁnds demand changes • QD SUV = 1000 - (4/100)*P (demand went down) • QD RDST = 1000 - (4/200)*P (demand went up) • Declining Marginal Products and Increasing Opportunity Costs • Good A initial position is at 0, and Good B initial is at (4,4). If you want to add a worker to good A you add a worker and ﬁnd MP of X 1 . If you take one away from B then you ﬁnd OC of 1 st A unit. In order tog et up to 2 units for good A you need 2 more units to make one more car. In order to make the second car you needed to give a lot up of B. Mc = products used up. OC = Give up products (trade offs). • Economic Growth: The ability of the economy to produce increasing quantities of goods and services....
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This note was uploaded on 04/15/2008 for the course ECON 102 taught by Professor Drozd during the Spring '08 term at Wisconsin.
- Spring '08