Krugman AP Macro Economics Chapter 3
Subject:
Economics [1]
Tags:
economics [2]
Microeconomics [3]
Costs [4]
Inefficiency [7]
Opportunity cost [8]
Production theory [10]
behavior [11]
Human development [12]
Computing [13]
Electronic documents [15]
Psychoanalysis [17]
Human behavior [18]
Attachment theory [20]
Technology [21]
Business [22]
? Chapter 3: The Production Possibilities Curve Model ? Trade-Off: when you give something up in order to have something else Production Possibilities Curve Model: simplified economy that only produces two goods, able to show trade-off?s more clearly, simplifies the complexities of reality inside/on the curve (shaded area): feasible outside the curve (shaded area): not feasible PPC= production possibilities curve Slope of a straight line production possibilities curve equal to the opportunity cost Outward shift: increase in resources of progress in technology Efficient: no missed opportunities, no way to make some people better off without making other people worse off