ECON 201 Lecture Notes - Lecture 3: Comparative Advantage, Business Cycle
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ECON 201 Full Course Notes
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Zoe has the comparative advantage for sh production. Amanda will make 18 vegetable and zoe will make 18 sh. The exchange ration at which producer will exchange product. Zoe:(opp cost of producer) t f > o. 5 v/f amanda:(opp cost of cons. ) Amanda: (opp cost for producer) t v > o. 66 f/v zoe: (opp cost for consumer) t v < 2 f/v. The economy wide ppf is the set of combinations of goods that can be produced in the economy where all available production resources are being used. The ppf can also be used to illustrate 3 aspects of macroeconomics: the level of a nation"s output (gdp, the growth of a nation"s output, short-run business cycles or uctuations in a nation"s output. The graph below represents an economy operating at full employment and producing goods and services. * add graph for full employment output: economic growth.
