ECON-E 201 Lecture Notes - Lecture 3: Discount Window
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ECON-E 201 Full Course Notes
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A right shift in ppf means that more of both goods possible and is caused by: more resources, technology advancing. Change in resources or technology affecting only one output: example: cars and computers, technology advance in computer production (keeping cars and computers separate) Huge point: more of both outputs possible! Why: resources freed up from computer production can produce more cars. Ppf example: capital/consumption tradeoff: capital: produced goods that produce other goods, consumption: satisfy wants. More capital now -> more resources next period: -> bigger shift next period, -> faster econ growth, -> living standard rises. Next weekend: the question, consume now or consume (more) later, true for individuals, for societies, for rich and for poor, so which is better?". Ppf can"t tell us (cid:498)to be, or not to be? (cid:499) (cid:498)consume or invest? (cid:499) (cid:498)marshmallow experiment(cid:499) Give a kid a marshmallow, leave, if the kid didn"t eat it, Discount rate: rate at which you (cid:498)discount(cid:499) the future.
