E. A decrease in the minimum w, Which of the following would cause an increase in a nation's long-run economic growth? can have devastating effects on a country. Which of the following is not predicted by the technology shock driven real business cycle (RBC) theory? b. a. a lower level of capital per worker b. an increase in the saving rate c. a rise in the rate of population growth d. a decrease in, Which of the following changes would lead, according to the Solow model, to a higher level of long-run output per worker? There, 50 pairs of skis could be produced per month at a cost of 100 snowboards, or an opportunity cost of 2 snowboards per pair of skis. In Panel (a), a point such as N is not attainable; it lies outside the . Outside its PPC VAT reg no 816865400. Increased globalization that moves the economy from a manufacturing-based economy to a more service-based economy c. A recession caused by a dro. Which of the following is the so-called efficiency factor of economic growth? D. Improved labor productivity. an increase in the labor force. Explain. D. Enhanced quantity and quality of human resources, Economic growth can best be portrayed as a: d. nation B/smaller. B. has increased productivity in the servic, Which would be least likely to cause the production possibilities curve to shift to the right? The absolute value of the slope of any production possibilities curve equals the opportunity cost of an additional unit of the good on the horizontal axis. These resources were not put back to work fully until 1942, after the U.S. entry into World War II demanded mobilization of the economys factors of production. c. Lax labor laws. A. Production and employment fell. An economy's factors of production are scarce; they cannot produce an unlimited quantity of goods and services. In the section of the curve shown here, the slope can be calculated between points B and B. What is full employment? Because a shrinking population has reduced the number of productive workers in the economy. C. The rate of tec, What do we call the situation where capital grows faster than the labor force? Poorly constructed buildings and investment in technologies inappropriate to a countrys stage of development might limit the impact of investment on average living standards. The Industrial Revolution and modern economic growth resulted in: Economic historians date the start of the Industrial Revolution around the year 1776, when. the stock of capital technological advance the size and quality of the labor force full employment. Improved methods of production c. An increase in the education and training of the labor force d. A decrease in unempl, Which of the following shifts the production possibilities frontier outward? How would an economy-wide technological improvement affect wages? The production possibilities model suggests that specialization will occur. Nam lacinia pulvinar tortor nec facilisis. Pellentesque dapibus efficitur laoreet. A decrease in the size of the labor force. Which of the following is affected by changes in aggregate demand? The attempt to provide it requires resources; it is in that sense that we shall speak of the economy as producing security. hich of the following will cause the production possibilities curve to shift inward? Manna from heaven. But simply an increase in capacity to produce isn't economic growth unless its put to use. We can use the production possibilities model to examine choices in the production of goods and services. The curve is a downward-sloping straight line, indicating that there is a linear, negative relationship between the production of the two goods. An economys factors of production are scarce; they cannot produce an unlimited quantity of goods and services. If the total amount of production factors like labor or capital increases, then the economy is able to produce more goods at any point along the frontier. c) a decline in the economy's total production. Pellentesqu, Explore over 16 million step-by-step answers from our library, ctum vitae odio. Each of the plants, if devoted entirely to snowboards, could produce 100 snowboards. How many jobs were lost, as a result, in a labor force of 175 million? Here, we have placed the number of pairs of skis produced per month on the vertical axis and the number of snowboards produced per month on the horizontal axis. Draw the production possibilities curve for Plant R. On a separate graph, draw the production possibilities curve for Plant S. Which plant has a comparative advantage in calculators? e) All of the abov, "From 1950 to 2000, manufacturing employment as a percentage of total employment in the US economy fell from 28% to 13%. Imagine that you are suddenly completely cut off from the rest of the economy. What are some examples of technological change that has caused unemployment? (2 points) Fireworks for everyone in their sightline A toll road A glass of water Seats at a movie theater An unclaimed spot on a beach Which, 1.08 Basic Economic Concepts Q. Had the firm based its production choices on comparative advantage, it would have switched Plant 3 to snowboards and then Plant 2, so it could have operated at a point such as C. It would be producing more snowboards and more pairs of skisand using the same quantities of factors of production it was using at B. C. modern technology. The production possibilities curves for the two plants are shown, along with the combined curve for both plants. Inward shifts in production possibility frontier means that the economy is shrinking i.e. One, of course, was increased defense spending. Experts are tested by Chegg as specialists in their subject area. An outward shift of a nation's production possibilities curve:Multiple Choice could reduce the nation's real GDP. This might come about either from the natural growth of a country's . Suppose Alpine Sports operates the three plants we examined in Figure 2.4 Production Possibilities at Three Plants. C. an increase in the skills of the labor force. Of course, an economy cannot really produce security; it can only attempt to provide it. The creation of national unemployment offices to increase the information about jobs. More output from more workers. If nation A commits a larger share of its resources to capital and technological improvements than nation B, then over time _____ will realize _____ outward shifts in its production possibilities curve. Economists conclude that it is better to be on the production possibilities curve than inside it. Arightward(anoutward)shiftofanation'sproductionpossibilitiescurvecouldbecaused. But when the frontier shifts outward, it is possible to produce more of both goods. Which of the following would most likely shift the production possibilities curve inward? The slope of Plant 1s production possibilities curve measures the rate at which Alpine Sports must give up ski production to produce additional snowboards. Which of the following would shift a nation's entire production possibilities curve outward? How does cyclical unemployment relate to a nation's production possibilities curve and how does cyclical unemployment behave across the business cycle? The highest point on the curve is when you only produce one good, on the y-axis, and zero of the other, on the x-axis. You'll get a detailed solution from a subject matter expert that helps you learn core concepts. West Yorkshire, Notice that this production possibilities curve, which is made up of linear segments from each assembly plant, has a bowed-out shape; the absolute value of its slope increases as Alpine Sports produces more and more snowboards. In applying the model, we assume that the economy can produce two goods, and we assume that technology and the factors of production available to the economy remain unchanged. The production possibilities model does not tell us where on the curve a particular economy will operate. It illustrates the production possibilities model. It illustrates the production possibilities model. Second, the quality of investment is probably as important as the quantity of capital spending. iii. Specialization implies that an economy is producing the goods and services in which it has a comparative advantage. Access to over 100 million course-specific study resources, 24/7 help from Expert Tutors on 140+ subjects, Full access to over 1 million Textbook Solutions. Explain. Understanding and creating graphs are critical skills in macroeconomics. Which of the following would tend to increase the natural unemployment rate? In this video I explain how the production possibilities curve shifts when there is a change in resources or a change in technology. O could increase the nation's real GDP, but not the real- GDP per capita. Alpine Sports can thus produce 350 pairs of skis per month if it devotes its resources exclusively to ski production. Slow growth rates of production and employment. A. 79. A lower level of capital per worker. We assume that the factors of production and technology available to each of the plants operated by Alpine Sports are unchanged. A decrease in growth rates will cause: A. no shift of an economy's production possibilities curve B. an outward shift of an economy's production possibilities curve C. a movement from a point inside a; The potential output of an economy is: A. the output level at which nominal GDP is equal to real GDP. We can think of this as the opportunity cost of producing an additional snowboard at Plant 1. The answer is Yes, and the key lies in comparative advantage. This might come about either from the natural growth of a countrys population especially for nations with a low median age. At point A, Alpine Sports produces 350 pairs of skis per month and no snowboards. How does technological progress shift the labor demand curve? Between points A and B, for example, the slope equals 2 pairs of skis/snowboard (equals 100 pairs of skis/50 snowboards). Which of the following is most likely to increase the natural rate of unemployment? Select one: a. Productivity is pro-cyclical. Economic growth is being able to make more things. When devoted solely to snowboards, it produces 100 snowboards per month. C) lead to more rapid economic growth. a. c) Changes in society's institutional and cultural setting and resulting public policie, Which of the following statements is correct? Hong Kong, with its huge population and tiny endowment of land, allocates virtually none of its land to agricultural use; that option would be too costly. Which of the following was responsible for slower economic growth prior to the Industrial Revolution? If you're behind a web filter, please make sure that the domains *.kastatic.org and *.kasandbox.org are unblocked. The opportunity cost of each of the first 100 snowboards equals half a pair of skis; each of the next 100 snowboards has an opportunity cost of 1 pair of skis, and each of the last 100 snowboards has an opportunity cost of 2 pairs of skis. Investment in capital goods such as new plant and machinery, factories, new hardware and software and investment in critical infrastructure leads to a higher capital stock. Explain how technological changes that have reduced the demand for low-skilled workers can change the natural rate of unemployment. A)movementoffthecurvetoapointinsidethecurve. copyright 2003-2023 Homework.Study.com. Improved methods of production c. An increase in the education and training of the labor force d. A decrease in unemplo, What might help with structural unemployment? Explain. C. average family size in the United States. In this example, production moves to point B, where the economy produces less food (FB) and less clothing (CB) than at point A. B) The emigration of highly skilled workers to rich countries. What is technological unemployment? Having an efficient financial system Option 1 - could reduce the nation's real GDP An outward shift production possibility curve denotes increase in production and increase in production means increase in GDP therefore. D. the annual increase in nominal GDP per worker. The deportation of illegal immigrants. It has an advantage not because it can produce more snowboards than the other plants (all the plants in this example are capable of producing up to 100 snowboards per month) but because it is the least productive plant for making skis. C a change in the amounts of one good desired. Plant 3, though, is the least efficient of the three in ski production. We will make use of this important fact as we continue our investigation of the production possibilities curve. The following are elements in the balanced scorecard and the four key perspectives. Concerning a country's business cycle, which of the following situations is commonly associated with large or growing current account deficits? 2313 chapter 16 power point notes creating an The combined production possibilities curve for the firms three plants is shown in Figure 2.5 The Combined Production Possibilities Curve for Alpine Sports. Many countries, for example, chose to move along their respective production possibilities curves to produce more security and national defense and less of all other goods in the wake of 9/11. The increase in spending on security, to SA units of security per period, has an opportunity cost of reduced production of all other goods and services. The PPC can be used to illustrate the concepts of scarcity, opportunity cost, efficiency, inefficiency, economic growth, and contractions. a. a decrease in unemployment b. improved methods of production c. an increase in the labor force d. an increase in the education and training of the labor forc, Which would be least likely to cause the production possibilities curve to shift to the right? Direct link to Anuj Khadka's post how does capital forms?, Posted a month ago. the know how to combine labor, capital, and natural resources to produce is an important aspect of production. B) are often more highly skilled than other workers. a. an increase in the labor force b. improved methods of production c. a decrease in unemployment d. an increase in the education and training of the labor forc. An economy cannot operate on its production possibilities curve unless it has full employment. If you're seeing this message, it means we're having trouble loading external resources on our website. Explain. Use the production possibilities model to distinguish between full employment and situations of idle factors of production and between efficient and inefficient production. The AD curve will most likely shift to the left when this increase in productivity is the result of which of the following? Learn More. D.Rightward shift of the production possibilities curve, Suppose that an economy is initially operating at a point on its PPC. An outward shift in a production possibilities curve is illustrated in Figure 2.13 "Economic Growth and the Production Possibilities Curve". The number of unemployed workers increases, c. A new technique improves the efficiency of extracti, Which of the following might help with structural unemployment? Points on the production possibilities curve thus satisfy two conditions: the economy is making full use of its factors of production, and it is making efficient use of its factors of production. Do technology improvements that allow firms to save on labor by reducing the amount of labor used per unit of output always reduce the industry demand for labor? Does a labor-using improvement in technology tend to raise or lower labor productivity? For example, suppose Carmen splits her time as a . Based on your own experience and reasoning, list 2 j, Which would be least likely to cause the production possibilities curve to shift to the right? An increase in the number of hours in the work week. To see this relationship more clearly, examine Figure 2.3 The Slope of a Production Possibilities Curve. b. b. b. C. work-activity rate. QUESTION 1 Exhibit 11-10 Labor and wage rate data Labor 6 7 8 9 10 Wage $12 13 14 15 16 2. Which of the following is not a factor that explains jobless recoveries? The number of unemployed persons increased by a smaller percentage, The long-run aggregate supply curve shifts right if? A. C) producing more consumer and fewer capital goods. D. increased for unmarried women but decreased for married women. The plant for which the opportunity cost of an additional snowboard is greatest is the plant with the steepest production possibilities curve; the plant for which the opportunity cost is lowest is the plant with the flattest production possibilities curve. The bowed-out production possibilities curve for Alpine Sports illustrates the law of increasing opportunity cost. There are 200 million unemployed people that work. A.Still on its PPC Producing more snowboards requires shifting resources out of ski production and thus producing fewer skis. Donec aliquet. Suppose there are 100 million workers in the economy, and full employment is defined as 96% of them being employed. These are also illustrated with a production possibilities curve. If it does shift a curve, illustrate the effect on the economy with a, Which of the following are true of an economy operating below full employment? production possibilities curve Even though each of the plants has a linear curve, combining them according to comparative advantage, as we did with 3 plants in Figure 2.5 The Combined Production Possibilities Curve for Alpine Sports, produces what appears to be a smooth, nonlinear curve, even though it is made up of linear segments. Thus, the economy chose to increase spending on security in the effort to defeat terrorism. could increase the nation's real GDP, but not the real-. (Consider This) Over the past several decades, the percentage of women in the paid U.S. Real wage is cyclical. How would a recession impact. a. Notice the curve still has a bowed-out shape; it still has a negative slope. Such an allocation implies that the law of increasing opportunity cost will hold. See what the PPF graph represents and what causes the ppc curve to shift outward. Neither skis nor snowboards is an independent or a dependent variable in the production possibilities model; we can assign either one to the vertical or to the horizontal axis. B.Reaching full production potential An outward shift of a nation's production possibilities frontier can occur due to A B a reduction in unemployment. Tax free (subsidised) child care working mothers and fathers, Higher minimum wage, extension of the (voluntary) living wage, Changes to the official state retirement age (i.e. Which of the following is not considered a source of increased labor efficiency? (a) an increase in technology (b) an increase in the number of workers available (c) an improvement in the literacy rate (d) a reduction in the unemployment rate, Which of the following will cause the production possibilities curve to shift inward? Scarcity implies that a production possibilities curve is downward sloping; the law of increasing opportunity cost implies that it will be bowed out, or concave, in shape. the economy will end up: She also modified the first plant so that it could produce both snowboards and skis. Labor productivity is increased by all of the following except A. an unskilled workforce. B. a decrease in the size of the labor force. $52,610 at$8 12\frac{1}{2}21%$ for 82 days. Its both. If the firm wishes to increase snowboard production, it will first use Plant 3, which has a comparative advantage in snowboards. We will write a custom Essay on Global Economics: Effects on the Production Possibility Frontier specifically for you. Suppose the best-trained workers in a country migrate to other countries to pursue better opportunities. Existing workers in a country get trained to operate widely used accounting software. The opportunity cost of an additional snowboard at each plant equals the absolute values of these slopes. Because technological innovat. A. An economy grows when it has the capacity to produce more. downward shift of the nation's aggregate expenditure curve. A. a decrease in worker education B. a decrease in government investment in R&D C. a decrease in interest rates D. a total ban on immigration E. an increase in the production o, Which of the following is most likely to cause a leftward shift in the long-run aggregate supply curve? C.increased due to higher wages, expanded job accessibility, changing preferences and [.1.3.6.2.4.4]\begin{bmatrix} We would say that Plant 1 has a comparative advantage in ski production. A decline in the birth rate B. What is the effect of reduction in labor hours worked each day on an economy's production possibility curve? Choose all that apply A. Course Hero is not sponsored or endorsed by any college or university. An increase in the age of the working population. 2.3 Applications of the Production Possibilities Model, 4.2 Government Intervention in Market Prices: Price Floors and Price Ceilings, 5.2 Responsiveness of Demand to Other Factors, 7.3 Indifference Curve Analysis: An Alternative Approach to Understanding Consumer Choice, 8.1 Production Choices and Costs: The Short Run, 8.2 Production Choices and Costs: The Long Run, 9.2 Output Determination in the Short Run, 11.1 Monopolistic Competition: Competition Among Many, 11.2 Oligopoly: Competition Among the Few, 11.3 Extensions of Imperfect Competition: Advertising and Price Discrimination, 14.1 Price-Setting Buyers: The Case of Monopsony, 15.1 The Role of Government in a Market Economy, 16.1 Antitrust Laws and Their Interpretation, 16.2 Antitrust and Competitiveness in a Global Economy, 16.3 Regulation: Protecting People from the Market, 18.1 Maximizing the Net Benefits of Pollution, 20.1 Growth of Real GDP and Business Cycles, 22.2 Aggregate Demand and Aggregate Supply: The Long Run and the Short Run, 22.3 Recessionary and Inflationary Gaps and Long-Run Macroeconomic Equilibrium, 23.2 Growth and the Long-Run Aggregate Supply Curve, 24.2 The Banking System and Money Creation, 25.1 The Bond and Foreign Exchange Markets, 25.2 Demand, Supply, and Equilibrium in the Money Market, 26.1 Monetary Policy in the United States, 26.2 Problems and Controversies of Monetary Policy, 26.3 Monetary Policy and the Equation of Exchange, 27.2 The Use of Fiscal Policy to Stabilize the Economy, 28.1 Determining the Level of Consumption, 28.3 Aggregate Expenditures and Aggregate Demand, 30.1 The International Sector: An Introduction, 31.2 Explaining InflationUnemployment Relationships, 31.3 Inflation and Unemployment in the Long Run, 32.1 The Great Depression and Keynesian Economics, 32.2 Keynesian Economics in the 1960s and 1970s, 32.3. a. a) What do these facts say ab, Which of the following changes would increase structural unemployment? Because the shrinking population has reduced the number of productive workers in the economy. b. a. Direct link to SulakShana Sumaruth's post Distinguish between econo, Posted 5 years ago. C) Rapid population growth that increases the burden on the education. Several middle-eastern countries including the UAE have relied heavily on migrant workers to increase their labour supply to sustain economic growth.
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