ECO 1002 Lecture 4: ECO Chapter 2.2
Document Summary
Model building and gains from trade (part 2) 43 trade-off between present and future: consumer goods. Examples: food, clothes, etc : capital goods. Goods that help produce other valuable goods. Examples: buildings, factories, roads, machinery, robots, computers: investment. Using resources to make new capital goods. 46 capital goods and future growth: over the last 20 years, china and india have invested in more capital compared to the. China is sacrificing today"s consumption for a better future. China and india have higher growth rates. Another trade-off: chinese workers have less leisure time than american workers. 50 visualizing investment: other examples of long-term investment. 53 summary: microeconomics is primarily concerned with the decisions of households and businesses. With regard to the ppf, an efficient point is a point that is a. impossible to reach: inside the ppf, outside the ppf, on the ppf.
