The first principle of economics discussed in Chapter 1 is that people face trade-offs. Use a production possibilities frontier to illustrate society's trade-off between two ""goods""-a clean environment and the quantity of industrial output. What do you suppose determines the shape and position of the frontier? Show what happens to the frontier if engineers develop a new way of producing electricity that emits fewer pollutants.

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Athena Mathis

Business

3 September, 05:42

The first principle of economics discussed in Chapter 1 is that people face trade-offs. Use a production possibilities frontier to illustrate society's trade-off between two ""goods""-a clean environment and the quantity of industrial output. What do you suppose determines the shape and position of the frontier? Show what happens to the frontier if engineers develop a new way of producing electricity that emits fewer pollutants.

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Elise Wilcox · Answer 1

The new way to produce electricity will increase the industrial output the enviroment can support. Thus, the PPF will expand as the opportunity cost in clean enviroment decreases

However an enviroment is either clear or not clean, there isn't more "clean" so it will not expand on the X axis.

Explanation:

The enviroment will decrease at more industrial output.

As we cannot live in an eviroment at zero habiltability we will never shift to complete industrial output.

But, at more insdustrial output we produce, more will it effect the envorement.