Macro Economics Lecture notes Week 1
Macro Economics Lecture notes Week 1 Econ 401
Popular in Macroeconomics
Popular in Economics
This 2 page Class Notes was uploaded by Cassie Lee on Wednesday October 5, 2016. The Class Notes belongs to Econ 401 at University of New Hampshire taught by Marco Vincenzi in Fall 2016. Since its upload, it has received 3 views. For similar materials see Macroeconomics in Economics at University of New Hampshire.
Reviews for Macro Economics Lecture notes Week 1
Report this Material
What is Karma?
Karma is the currency of StudySoup.
You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!
Date Created: 10/05/16
Lecture 2 September 1, 2016 PRODUCTION POSSIBILITY FRONTIER: A curve showing the maximum attainable combination of two goods that may be produced, given the available resources and current technology. Production= Produced Possibility= Attainable Frontier=Maximum Ex. Graphing a linear combination of two goods Graphing a linear combination of two goods: (Solved Problem 2.1 p.44) Tesla Operates 8 hours per day. In an hour, it can make 15 sedans OR 10 SUV Choice Sedans SUVs # of Sedans # of SUVs A 8 0 15x8=140 10x0=0 B 7 1 15x7=105 10x1=10 C 6 2 15x6=90 10x2=20 D 5 3 15x5=75 10x3=30 E 4 4 15x4=60 10x4=40 F 3 5 15x3=45 10x5=50 G 2 6 15x2=30 10x6=60 H 1 7 15x1=15 10x7=70 I 0 8 15x0=0 10x8=80 1. Attainable: combinations on or inside the PPF A, B, C…I, B’ 2. Unattainable: combinations beyond the PPF B” 1. Technically Efficient: combinations on the PPF A, B, C…I 2. Inefficient: combinations inside the PPF B’ Lecture 2 September 1, 2016 Is it always a linear combination? (Problem 1.10 p.67) Increasing Marginal Opportunity Cost Linear Constant Opp. Cost Increasing Diminishing Returns HOW DO ECONOMIES GROW? 1. More resources become available: Labor: all types of work Capital: computers, machines, tools, etc. Natural resources: land, water, raw materials, etc. 2. Technological change in one industry: Entrepreneur: someone who operates a business Property Rights provide incentives for innovation ABSOLUTE ADVANTAGE VS. COMPARATIVE ADVANTAGE (figure 2.4) Absolute advantage: the ability of an individual to produce more of a good, using the same amount of resources Comparative advantage: the ability of an individual to produce a good at a lower opportunity cost
Are you sure you want to buy this material for
You're already Subscribed!
Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'