--%>
Assignment Help - homework help

Society decide its optimal point on the production

How does society decide its optimal point on the production possibilities curve?

E

Expert

Verified

1. Recall that society receives marginal benefits from each additional product consumed, and as long as this marginal benefit is more than the additional cost of the product, it is advantageous to have the additional product.

2. Conversely, if the additional (marginal) cost of obtaining an additional product is more than the additional benefit received, then it is not “worth” it to society to produce the extra unit.

3. Marginal benefits decline as society consumes more and more pizzas.

a. Beyond that, the added benefits would be less than the added cost.

b. At less than 200,000, the added benefits will exceed the added costs, so it makes sense to produce more.

4. Generalization:  The optimal production of any item is where its marginal benefit is equal to its marginal cost.  As an eg: this ought to come about at 7,000 robots for robots.

   Related Questions in Business Economics

  • Q : The federal fiscal stimulus Question:

    Question: Was the stimulus package passed in 2009 as success?  In answering this question the focus should be the articles on the syllabus, but you should also include opinions of other commentators.   Your answer should also describe w

    		•
  • Q : Writ short note on the income of

    Writ short note on the income of functional distribution?

    		•
  • Q : Reducing output of other good When the

    When the production possibilities frontier in a proficient economy is not growing, raising the output of one good always needs: (i) Increasing the output price for the other good. (ii) Bigger amounts of resources. (iii) Decreasing the output of other

    		•
  • Q : Technological advances in producing

    When given resources can now produce additional goods than was previously probable, then there have been a: (1) Stock market boom. (2) Competitive spurt which shrinks entrepreneurial gain. (3) Concavity reversal in the production possibilities frontier. (4) Bigger rel

    		•
  • Q : Major type of expenditure at the state

    What is the most important source of revenue and the major type of expenditure at the state level?  

    		•
  • Q : Capitalism-Tightly regulate business I

    I have a problem in economics on Capitalism-Tightly regulate business. Please help me in the following question. The govt. in a purely capitalist state would not: (1) Find out the property rights. (2) Enforce contracts among private parties. (3) Offer

    		•
  • Q : Contestable Markets The least probable

    The least probable of the given industries to be a contestable market is: (1) video rentals. (2) pizza delivery. (3) cable television. (4) trucking. Can someone explain/help me with best solution about problem of <

    		•
  • Q : Government expenditures on goods and

    Explain Government expenditures on goods and services and transfer payments?

    		•
  • Q : What 2 points are required to emphasis

    What 2 points are required to emphasis foreign exchange market?

    		•
  • Q : Good economic policy requires good

    Explain the statement: “Good economic policy requires good economic theory.”?

    		•