--%>
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 : Fixed or managed exchange rate

    Question: A country with a fixed or managed exchange rate would consider i.___________________ its currency to gain competitive advantage vis-à-vis its trade

    		•
  • Q : Exchange and Specialization I have a

    I have a problem in economics on Exchange and Specialization. Please help me in getting the right answer from the following question. Sarah the wheat farmer would be most probable to trade for fruit from the Kathy's orchard if: (i) Sarah's opportunity

    		•
  • Q : How is productivity of labor based

    In Wealth of Nations by Adam Smith, opined that the productivity of labor based primarily on: (w) workers’ education. (x) divisions of labor. (y) technologically advanced machines. (z) suitable wage rates.

    Q : Describe composite cost of capital

    Briefly describe composite cost of capital? And also describe the procedure to calculate composite cost of capital?

    		•
  • Q : Why Public or social goods not be

    Why Public or social goods not be produced through the market?

    		•
  • Q : Fruit Question: Read the following

    Question: Read the following excerpts from the article "Fruit, veg costs surge' by Todd, Dagwell, published in the Herald on January 25th 2011 and answer questions below:

    Q : How can we compute operating leverage

    How can we compute operating leverage?

    		•
  • Q : Illustrate the advantage and

    Illustrate the advantage and disadvantage of Corporations?

    		•
  • Q : Business Economics Hello, I would like

    Hello, I would like help with my assignment.

    		•
  • Q : Demand supply Newspaper item: “Due to

    Newspaper item: “Due to lower grain prices, consumers can expect retail prices of choice beef to begin dropping slightly this spring with pork becoming cheaper after midsummer,” the Agriculture Department predicted. “This reflects increasing supply,” the department said. Does the statement use th

    		•