Unformatted text preview: go to college, etc.) -Product Possibility Frontier (PPF) (not long-term perspective) o US Economy produces consumer and investment goods o Graph, at any point on the PPF, a certain amount of consumer goods and investment opportunities are created o Fixed/finite resources & static, given technology o Law of Increasing Opportunity Costs When you take resources and convert them to another form, the productivity of the resources is bound to diminish, and thus the output, value-wise, will be less than the potential output lost Resources, or people, might not be suitable for this “new” activity In dealing with people, an adjustment period is usual, and thus they might need to be re-trained, during which productivity will generally be lower...
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This note was uploaded on 06/05/2008 for the course ECON Principles taught by Professor Kitsikopolous during the Spring '07 term at NYU.
- Spring '07