Now that you have read about scarcity and the production possibility frontier, I would
like each of you to answer the following questions.  In a week's time I will also post the answers.

Here are the questions.

What will happen to the production possibility curve in each of the following?

1. The economy is in a recession. 10% of the labor force in unemployed. What will
happen if the rate of unemployment falls from 10% to 6%?

2. Suppose society produces two goods, capital goods and food. Suppose there is a breakthrough in biogenetics which produces a new type of corn that has more ears of
corn per stalk?

3. Suppose there is a war?

4. Suppose the society produces consumer goods and caital goods. What will happen
if the level of education rises?