Econ102January30 - d. Where did they go wrong? e. Position...

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Econ 102 January 30, 2008 I. Marginal Product a. MPinput = Change output/change input b. MP labor in respect to guns = change in guns / change in labor c. Labor in real life actually begins exponentially and then increases at a decreasing rate- it looks like a Wal-Mart shopping curve… what’s it called? II. The Law of Diminishing Marginal Returns a. Thomas Malthus and David Ricardo b. English 19 th century economists c. Worried about fixed supply of land, LDMR, increasing population and the inability to feed ourselves
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Unformatted text preview: d. Where did they go wrong? e. Position of the PPF i. Affected by 1. Growth 2. New technology 3. Increases in labor production 4. Increases in capital productivity 5. Investments in human and economic capital ii. PPF gymnastics III. David Ricardo a. Famous 19 th century British Economist b. Some consider him the grandfather of international trade theory c. Very influential in pioneering the theory of comparative advantage, inter alia d. Very interesting e....
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