Principles_OTHERsolution_ch2 - Suggested Answers for...

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Suggested Answers for Mankiw, Chapter 2, “Other” Problems 1. See Figure 5; the four transactions are shown. Figure 5 3. See Figure 7. The shape and position of the frontier depend on how costly it is to maintain a clean environment the productivity of the environmental industry. Gains in environmental productivity, such as the development of new way to produce electricity that emits fewer pollutants, lead to shifts of the production- possibilities frontier, like the shift from PPF 1 to PPF 2 shown in the figure. Figure 7
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5. a. A worker's decision about how many hours to work is related to microeconomics. b. The effect of government spending on the unemployment rate is related to macroeconomics. c. The impact of new technology in the market for DVD recorders is related to microeconomics. d. The relationship between education and economic growth is related to macroeconomics. e. The optimal choice of output for a firm that produces electric heaters is related to microeconomics. 6.
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This note was uploaded on 04/23/2010 for the course ECONOMICS 2312 taught by Professor William during the Spring '09 term at 東京大学.

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Principles_OTHERsolution_ch2 - Suggested Answers for...

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