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Unformatted text preview: o 3. Increases in Size + Quality of Labor Force More workers More skills human capital How to ppf inward? o 1348 Black Death o 1944 Germany hurricanes earthquakes wars o Slope of ppf + opp. Cost o Special resources + tech. same ppf straight o OC of 1 W = 1 G o OC of 1 G = 1 W o Sausage links + sausage patties o Same resources + tech. but patty is 2x as big 2 links = 1 patty o OC of 1 L = P OC of 1 P = 2 L - reciprocal relationship o OC of good on horizontal axis is slope ppf So far straight ppf constant slope constant OC More general case : resources + technology are specialized In general case of different resources + tech. ppf is concave principle of increasing opp. Cost OC of a good as we produce more + more...
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This note was uploaded on 04/19/2011 for the course EC 201 taught by Professor Ballard during the Fall '08 term at University of Michigan.
- Fall '08