Economic Growth, PPF, and the Tradeoff Between Capital and Consumer Goods
production possibility frontier-a curve showing the combination of two goods or services that can be produced using all available resources
There has to be a combination of capital and consumer goods you cant just make one or the other. capital goods are investing in the future and consumer goods you can use now.
potential GDP is the amount an economy can produce when using all available resources.
you can achieve economic growth by the following
Increase in Natural resources
increase in real capital
increase in technology
quantity and quality of labour- you can improve the quantity and quality of labour by
increasing the population
increase human capital
increase the labour productivity
Dr. Stephanie Powers, "Unemployment", Intro to Macroeconomics.(Lecture, Donald School of Business, Red Deer Alberta, Winter 2012)
production possibility frontier-a curve showing the combination of two goods or services that can be produced using all available resources
There has to be a combination of capital and consumer goods you cant just make one or the other. capital goods are investing in the future and consumer goods you can use now.
potential GDP is the amount an economy can produce when using all available resources.
you can achieve economic growth by the following
Dr. Stephanie Powers, "Unemployment", Intro to Macroeconomics.(Lecture, Donald School of Business, Red Deer Alberta, Winter 2012)