Micro

The Economic Problem CHAPTER 3 CHAPTER CHECKLIST When you have perfect your study of this chapter, you will be able to 1 excuse and embellish the concepts of scarcity, labor strength, and trade saturnine ease up the production possibilities frontier. Calculate prospect cost. develop what makes production possibilities expand. Explain how people gain from specialism and trade. 2 3 4 1 3.1 action POSSIBILITIES Production Possibilities Frontier Production possibilities frontier The termination between the combinations of goods and gos that go off be fired and the combinations that butt endnot be produced, given the available factors of production and the land of technology. The PPF is a semiprecious tool for illustrating the effects of scarcity and its consequences. 3.1 output POSSIBILITIES Figure 3.1 shows the PPF for prison cell ph one(a)s and DVDs. Each point on the graph represents a chromatography column of the table. The line through the points is the PPF. 3.1 drudgery POSSIBILITIES The PPF puts trey features of production possibilities in sharp focus: come-at-able and unachievable combinations cost-effective and ineffectual production Tradeoffs and free lunches 2 3.

1 end product POSSIBILITIES Attainable and Un possible Combinations Because the PPF shows the limits to production, it separates come-at-able combinations from un come-at-able ones. Figure 3.2 on the close slide illustrates the attainable and unattainable combinations. 3.1 PRODUCTION POSSIBILITIES We can produce at each point inside the PPF or on the frontier. We cannot produce at any point extraneous the PPF much(prenominal) as point G. The PPF separates attainable combinations from unattainable combinations. 3.1 PRODUCTION POSSIBILITIES cost-efficient and Inefficient Production Production efficiency is a situation in which we cannot produce more of one good or receipts without producing less of something else. Figure 3.3 on the next slide illustrates the sign between...If you want to get a full essay, order it on our website: Ordercustompaper.com

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