EMG_344-3_AEVA_Lecture-2

EMG_344-3_AEVA_Lecture-2 - Attainabl e Unattainable 1 2 3 4...

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Click to edit Master subtitle style EMG 344 -3 Applied Economics and Value Addition Recommended Texts: Nicholson W.E. (1997), Intermediate Microeconomics and Its Application, The Dryden Press, United States Tietenberg T. (2006), Environmental and Resource Economics, Addison-Wesley, 7th edition World Development Forum , (various issues), Global Competitiveness Report http://www.gcr.weforum.org/ Ferri F., S Treadwell and M.A. Desai (2005), Understanding Economic Value Added, Harvard Business Publications
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Production Possibilities Frontier l a graph that shows all the combinations of output that the economy can possibly produce given the available factors of production and the available production technology within a given period of time l Two goods/services l Resources are fully employed l Technology is fixed l Given time period
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Possibility Computers Mobile Phones Production Possibilities Frontier a 0 and 15 b 1 and 14 c 2 and 12 d 3 and 9 e 4 and 5 f 5 and 0
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Production Possibilities Frontier Computer s Mobile Phones 0 1 2 3 4 5 5 10 15
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Production Possibilities Frontier 0 1 2 3 4 5 5 10 15 a b d e c f Computer s Mobile Phones
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Production Possibilities Frontier
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Unformatted text preview: Attainabl e Unattainable 1 2 3 4 5 5 10 15 a b c d e f Computer s Mobile Phones Production Possibilities Frontier Attainabl e Unattainable 1 2 3 4 5 5 10 15 a b c d e f z Production Inefficiency Computer s Mobile Phones Production Possibilities Frontier Attainabl e Unattainable 1 2 3 4 5 5 10 15 a b c d e f z Production Inefficiency Computer s Mobile Phones Production efficiency Production Possibilities Frontier 1 2 3 4 5 5 10 15 a b d e c f Computer s Mobile Phones Production Possibilities Frontier 1 2 3 4 5 5 10 15 a b d e c f Computer s Mobile Phones Production Possibilities Frontier l Convex to the Origin l Concave to the Origin l Linear l Why? l Because of the opportunity cost Production Possibilities Frontier l What does it denotes by a PPF? l How a country can reach to an unattainable point Production Possibilities Frontiers l Increase in Technology l Increase of Resources l Increase in Efficiency l Foreign Trade l With Value Addition...
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This note was uploaded on 10/28/2009 for the course EMG 3444 taught by Professor Prof.abay during the Spring '09 term at University of Great Falls.

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EMG_344-3_AEVA_Lecture-2 - Attainabl e Unattainable 1 2 3 4...

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