Section Questions Week 1

Section Questions Week 1 - Questions for Economics 1 1....

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Questions for Economics 1 1. Suppose that the following the points (AGR,MAN)=(10,30) and (AGR,MAN)=(20,10) lie on society’s production possibilities frontier for manufactured goods and agricultural goods. a. Suppose that the PPF satisfies the law of increasing opportunity costs. If society produces 15 units of AGR, what is the most that you can say about the production of MAN? Using a graph, give your reasoning. b. Now, suppose that the PPF satisfies the law of decreasing opportunity costs (perhaps because of learning-by-doing). If society produces 15 units of AGR, what is the most that you can say about the production of MAN? Using a graph, give your reasoning. 2. Consider the production of agricultural goods (A) and capital goods (C). Assume that society’s production possibilities frontier satisfies the law of increasing opportunity costs and that bundles (A,C)=(100,0) and (A,C)=(50,40) are on the production possibilities frontier. If society devoted all of its resources to the production of capital goods, what’s the most you can say about how much it
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 2

Section Questions Week 1 - Questions for Economics 1 1....

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online