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Full Download Survey of Economics 9th Edition Tucker Solutions Manual
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Full Download Survey of Economics 9th Edition Tucker Solutions Manual
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Chapter 2
Production Possibilities, Opportunity Cost,
and Economic Growth
CHAPTER IN A NUTSHELL
In this chapter, you continue your quest to learn the economic way of thinking. The chapter
begins with the three basic questions each economy must answer: (1) What to produce? (2) How
to produce? and (3) For whom to produce? The chapter then introduces concepts which
economists use to analyze choice-the production possibilities curve and opportunity costs. The
production possibilities curve indicates various maximum combinations of the output of two
goods a simple economy can produce. The economy can achieve economic growth by pushing
the production possibilities curve outward. This shift in the curve can be caused by increasing
resources and/or advances in technology.
KEY CONCEPTS
Economic growth Opportunity cost
Investment Production possibilities curve
Law of increasing opportunity Technology
costs What, How, and
Marginal analysis For Whom questions
LEARNING OBJECTIVES
After completing this chapter, you should be able to:
Good Good
two two
Label Maximum
axes quantity
Step three: Plot the maximum quantity that can be produced if all Step four: Plot other maximum possible combinations of both
resources are used to produce only good two. goods that can be produced if all resources are used to produce
only two goods.
Maximum Other
quantity possible points
Good Good
two two
Good one
Good one
Step five: Draw a smooth curve connecting these Step six: Verify that increasing opportunity, measured on the
points and label it PPC. This curve is the production vertical axis, occurs as equal increments of good one are
produced along the horizontal axis and the slope gets steeper.
possibilities curve.
Production Production
Good
possibilities curve possibilities curve
two
opportunity costs
Increasing
Good
two
PPC
PPC
Good one
Equal increments Good one
2
COMPLETION QUESTIONS
3. The basic approach that compares additional benefits of a change against the
additional costs of the change is called .
8. The body of knowledge and skills applied to how goods are produced is
.
MULTIPLE CHOICE
1. Which of the following is not one of the three fundamental economic questions?
a. What happens when you add to or subtract from a current situation?
b. For whom to produce?
c. How to produce?
d. What to produce?
3
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Language: French
JEAN LORRAIN
Heures de Corse
PARIS
BIBLIOTHÈQUE INTERNATIONALE D’ÉDITION
E. SANSOT ET Cie
53, Rue Saint-André-des-Arts, 53
1905
Tous droits réservés
Il a été tiré de cet ouvrage :
Six exemplaires sur Japon impérial, numérotés de 1 à 6
et dix exemplaires sur Hollande, numérotés de 7 à 16.
HEURES DE CORSE
DE MARSEILLE A AJACCIO
La plainte des
palombes
Dans les micocouliers !