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CHAPTER 2 Production Possibilities Frontier Framework




Question;n Assignments for mastering KEY;IDEAS;Assignment;2.1;Key Idea: The PPF is a framework used to;examine production.;1. Explain;what a production possibilities frontier represents.;2. Analyze what it means;for the PPF to be bowed out from the origin (curved), and what it means for the;PPF to be a straight line.;3. State;the law of increasing opportunity costs and explain why it holds.;Assignment;2.2;Key Idea: The PPF can be used to demonstrate;several economic concepts.;1. Explain;how the PPF is used to demonstrate scarcity.;2. Use;the PPF to demonstrate choice and opportunity cost.;3. Define;productive efficiency and use the PPF to demonstrate it.;4. Use;the PPF to show unemployment.;5. Use PPF curves to show;economic growth and list the sources of economic growth.;Assignment;2.3;Key Idea: Individuals can make themselves;better off by specializing in production according to their comparative;advantages, and then trading for other goods.;1. Use the concept of;comparative advantage to describe who should produce a particular good.;2. Explain;why people should specialize and trade.;3. Explain;how acting in one?s self interest benefits society.


Paper#54984 | Written in 18-Jul-2015

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