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    Group Assignment Presentation

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    3 views22 pages

    Group Assignment Presentation

    Uploaded by

    nguyenquynhanh2006vp

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 22

    TOPIC 1:

    ECONOMICS
    AND ECONOMIC
    ISSUES
    Microeconomics - Group 5
    MEMBERS:

    01 02 03
    Nguyen Quynh Nguyen Ngoc Dang Khanh Vi
    Anh Huyen

    04 05
    Nguyen Ngoc Pham Phuong
    Mai Nga
    EXERCISE 1:
    Use the following production
    possibilities table for war
    goods and civilian goods to
    answer questions a to e.
    a. Graph the data in the table. Are there
    constant or increasing opportunity
    costs for the production of missiles?
    -The opportunity costs for the
    production of guided missiles are
    increasing because:

    •From B to A: The opportunity costs


    of producing an additional 3
    thousand guided missiles (from 27

    to 30) are 2 million cars => OC= ⅔


    -From C to B: The
    opportunity costs of
    producing an additional
    6 thousand guided
    missiles (from 21 to 27)
    are 2 million cars
    => OC=2/6=1/3

    -From D to C: The
    opportunity costs of
    producing an additional
    9 thousand guided
    missiles (from 12 to 21)
    are 2 million cars

    => OC=2/9
    •From E to D: The
    opportunity costs of
    producing an additional 12
    thousand guided missiles
    (from 0 to 12) are 2 million
    cars
    => OC=2/12=1/6
    b. If the economy is currently at point C:
    - What is the cost of one
    million more cars?
    The opportunity cost of producing
    an additional 2 million cars from C to
    D is 9 thousand guided missiles
    => The cost of one million more cars
    is 9/2=4.5 thousand guided missiles
    -What is the cost of one thousand
    more guided missiles?
    The opportunity cost of producing an
    additional 6 thousand guided missiles from
    C to B is 2 million cars.
    => The cost of one thousand more guided
    missiles is 2/6= 1/3 million cars.
    c. Label a point G
    inside the curve of
    the graph. What
    does it indicate?
    Point G is inside the curve and
    indicates the production output of
    1 car and guided missiles are 2 million
    and 10 thousand respectively

    With the statistic of 2 million


    cars, the most efficient number
    2 of guided missiles can produce is
    27 thousand.
    Conclusion:

    Potential for Improvements


    Inefficiency in increased possible
    production production through better
    resource usage
    Point G indicates The economy can
    that the boost production of By improving the
    economy is not both cars and missiles efficiency of resource
    utilizing its without requiring extra use, the economy
    resources fully, resources or can move from point
    leading to technology, as it still
    G to a point on the
    inefficiency. has capacity to expand
    PPF curve, achieving
    within its existing limits.
    higher productivity
    d. Label a point H that lies outside the PPF curve

    ● What does this point


    indicate?
    ● What must occur
    before the economy
    can attain the level
    of production
    indicated by point
    H?
    What does this point
    indicate?

    Point H lies outside the


    curve and indicates the
    production output of car
    and guided missiles are
    6 million and 25
    thousand respectively
    With the statistic of
    6 million cars, the
    most efficient
    number of guided
    missiles can only be
    produced is 12
    thousand

    ➔ The H point indicates the impossible use of resources in production.


    What must occur before the economy can attain the
    level of production indicated by point H?

    Economic growth Technological improvement


    The economy must expand The economy needs advances in
    its resources, such as labor, technology to produce more with
    capital, and natural the same amount of resources.
    resources. This increases the Technological progress helps
    overall production capacity boost productivity, reduce waste,
    of the economy. and improve production
    efficiency.
    e,Suppose improvement occurs in the technology
    of producing guided missiles but not in the
    production of cars.
    Draw the new
    PPF curve on the
    graph you
    created.
    e,Suppose improvement occurs in the technology
    of producing guided missiles but not in the
    production of cars.
    Now draw a curve
    that reflects
    technological
    improvement in
    the production of
    both products.
    EXERCISE 2:
    Assume that a simple economy has 2
    industries which produce wheat and cloths.
    Resources to produce these products are
    scarce and used effectively. The following
    table represents the possible combinations of
    output between wheat and cloths that this
    economy produces in a given year
    a. Draw the production possibility frontier (PPF) curve for this economy
    b. If output of wheat and cloths are 9 tons
    of wheat and 4000 set of cloths, what do
    you think about productive efficiency of
    this economy?

    Point G lies inside the PPF, so if the output


    of wheat and cloths are 9 tons of wheat and
    4000 sets of cloths means that this
    economy is not allocative efficient.
    -If it produces 9 tons of wheat, the greatest
    set of cloths it can produce is 9000 sets of
    cloths.
    -If it produces 4000 sets of cloths, the
    greatest set of wheat it can produce is 20
    tons.
    => So, the production of this economy is
    ineffective.
    C. Can this economy produce 20 tons of
    wheat and 10 000 of cloths?
    WHEAT
    The Answer Is NO
    CLOTHS

    BECAUSE: Limited resources


    WHEAT

    With 20 tons of wheat, there are only 4000 sets are


    produced.

    On the contrary, if 10 000 sets of clothes were


    produced, there is no ton of wheat at all.
    D. Calculate opportunity costs of
    producing wheat and cloths
    From A to B From B to C From C to D From D to E

    Opportunity costs of 5/4 5/3 6/2 9/1


    producing cloths

    From A to B From B to C From C to D From D to E

    Opportunities cost of 4/5 3/5 1/3 1/9


    producing wheat
    Thanks for your listening
    Do you have any questions?
    Group 5
    Microeconomics
    E-BDB 6

    CREDITS: This presentation template


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