Questions On Economics

Submitted By lauradoan
Words: 889
Pages: 4
Open Document
LBE 100 - MICROECONOMICS - ASSESSMENT TASK 1

a) The economy might not be able to produce all the schools and clinics the Minister's want because the Minster might want all those schools and clinics, but we have limited resources. We have two broad categories of economic resources; property resources and human resources. Property resources including land, raw materials and capital and human resources consisting of labour and entrepreneurial ability. This can put a constraint on the economy's product. There might not be enough natural resources that go into making goods and services or in this case enough resources to produce the schools and clinics. There might not be enough money for income for the people who will build these schools and clinics therefore that's another constraint. Also theres a constraint of technology might not be as advance as we'd hope it to be therefore it pulls the Minister back a step into producing these schools and clinics.

b)

A production possibilities curve shows the maximum possible outputs of 2 goods that can be produced. It shows how much we can produce with a fixed amount of resources and the given state of technology. The reason why it is curved and not straight is because a slope of a curve shows opportunity cost. Opportunity cost is the amount of other products that must be sacrificed to obtain an addition unit of a good. So therefore more technical schools that are produced, more health clinics need to be given up in order to produce technical schools.

The economy cannot produce 6 schools and 30 clinics at once, because it doesn't fall on the production possibility curve therefore it is using resources that the economy doesn't have therefore cannot produce this amount of clinics and schools at once. It is unattainable to produce that many because the production possibility curve shows the maximum outputs of two goods and we can't have both trying to reach the maximum amount of schools or clinics it can because as it's on a slope of curve, an amount of product has to be sacrificed in order to obtain an addition unit of good. So therefore the Minister cannot product 6 schools and 30 clinics at once.

c) Efficiency involves maximising satisfaction from out limited resources. There is productive efficiency which is producing those goods in the least costly manner and is shown by any position on the PPC. Allocative efficiency is allocating resources to produce the right goods and services shown by a specific point on the PPC. Inefficiency can arise from various sources. For example if the government was keeping imports from foreign countries, this limits reduces efficiency by keeping goods from being produced at a lower cost therefore creating inefficiency. Inefficiency relating to PPC is when they choose a point inside the curve. This is inefficient as it is a wastage of resources. It can be produced, but there is a gap between the point chosen and the maximum point that could of been chosen that would of had all resources fully and efficiently employed. The point of inefficiency is inside the curve that that is a waste of resources.

The Minister for Health's second choice is to produce 5 schools and 29 clinics. This combination is outside the curve therefore it is not possible. We do not have the resources or technology to produce this many schools or clinics. It is not efficient either because we cannot produce this many schools and clinics as the
Show More

Related Documents: Questions On Economics

Literature Summary: Nature And Scope Of Economics

Nature and Scope of Economics: A discussion Table of contents 1. Introduction 1.1. Literature Review 1.2. Research Questions 1.3. Scope and Objectives 1.4. Research Methodology 2. Criticism and Definition of Economics 2.1. Adam Smith 2.2. Alfred Marshall 2.3. Growth definition 3. Contents of Economics-Approaches 3.1. Traditional approach 3.1.1.1. Consumption 3.1.1.2. Production 3.1.1.3. Exchange 3.1.1.4. Distribution 3.1.1.5. Public finance 3.2. Modern approach 3.2.1.1. Microeconomics 3.2.1…

Words 1265 - Pages 6

Questions On Business Studies Marketing

marketing department has succeeded or failed. 5. External factors can be macro or micro. The macro-environment refers to factors that are way beyond a firms control such as political, economic, social, technological, legal and environmental. Whereas the micro-environment refers to the factors in the immediate environment of a business such as its suppliers, customers, substitutes and competitors. 6. Operations, human resources, finance, IT. 7. An internal factor is a factor that a business can control…

Words 486 - Pages 2

Essay about ECO2302 SYLLABUS SSI 2015 Online Course COB Format 1

Rice, SMU, TCU, Baylor, Texas Tech, The University of Texas at Austin, Texas A&M, and our own University of Houston-Downtown. 1. COURSE NUMBER AND TITLE: ECO 2302 Principles of Microeconomics (3-3-0) 2. CATALOG DESCRIPTION: Principles of micro-economics, with major emphasis on price and income distribution theory. Topics include demand theory, competition, oligopoly and monopoly, marginal productivity theory, international trade, and international finance. 3. PREQUISITES: Prerequisite (s)…

Words 2784 - Pages 12

Automotive industry Essay

Regulations: Safty standards and regulations of the country is one major macro environmental factor which affects automobile industry. These laws influence or limit the manufacturing capacity of the company. Economic environment Another external factor affecting automobile industry is the current economic environment. Growth of the industry is depended on consumers purchasing power and spending habits. People want to spend less and expecting more values. Therefore, it is necessary to cope with the expectation…

Words 455 - Pages 2

Racism In America

work within America though it may not appear so to a white person who doesn't have to experience it. But to be able to recognize what racism looks like one must know the definition and the forms it takes, such as racial prejudice, discrimination, and micro aggressions, and recognize that racism creates a system of advantage and disadvantage. We live in…

Words 1048 - Pages 5

Essay about Marketing Micro and Macro Environmental Factors

Macro and micro environments both fall into the categories of environmental scanning. The general scope of environmental scanning is that it is a component of global environmental analysis. While analyses are typically carried out on the macro environment, the micro environment still has an important role to play. In summary, the macro environment is involved with the industries, companies, markets, clients and competitors, while the micro environment can be represented by the suppliers, competitors…

Words 1694 - Pages 7

Ethics In Social Work

society and enhancing the lives of people. As a social worker, you might work on the macro level, which mean working for an association, organization, or community, or you may deal with the micro scale level. A micro level example would be private work on giving individual therapy. Rather working on the micro, mezzo, or macro level, service providers are required to stick to a professional code of ethics, which includes the core values of social work. For the research I will be conducting on childhood…

Words 565 - Pages 3

Demographics and Micro Environment Essay

Table of content Introduction 2 Habib Jewels 3 Micro environment 3 a) Customer. 3 b) Supplier. 3 c) Competitors. 3 d) Marketing intermediate 4 Macro environment 4 a) Political 4 b) Economic 4 c) Technology 4 Libresse 5 Micro environment 5 a) Customer 5 b) Company 5 c) Competitors 5 Macro environment 6 a) Cultural. 6 b) Economic 6 c) Natural 6 d) Demographic 6 Fair & Lovely 7 Micro environment 7 a) Company 7 b) Customer 7 c) Public 7 d) Competitor…

Words 3455 - Pages 14

Essay about The Difference between Microeconomics and Macroeconomics

When you hear the words Micro and Macro the first thing that comes to mind is small and big. Microeconomics is the study of the law of supply and demand at the consumer level. This is the decision by individual households on allocation of limited resources. Macroeconomic decisions are focused on the country and governmental decisions. Macroeconomics is the study of the economy as a whole. While microeconomics deals with households and the consumer level, macroeconomics deals with complete…

Words 1272 - Pages 6

Supply and Demand and Price Rises Quantity Essay

Review Ch.1 Scarcity- resources are scarce and decisions must be made Opportunity cost- highest valued alternative Micro- the study of the behavior of individuals, particular markets, firms, and industries Macro- looks at the entire economy, or its major aggregates or households, businesses and the government Factors of production- Land ex. Oil, Labor ex. Workforce/teacher, Capital ex. factories, Entrepreneurial ex. risk Ch.2 Difference between command and market??? -the government…

Words 471 - Pages 2