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Help please. Do calculations thoroughly please 6. Let's analyze the effect of a technological advance on the marginal social costs of production. Currently, the marginal
Help please. Do calculations thoroughly please
6. Let's analyze the effect of a technological advance on the marginal social costs of production. Currently, the marginal social cost of increasing production of X from 2 units to 4 units is units of Y. Now suppose that, over a span of several years, a technological progress takes place in the Y industry so that for each level of X production the country can produce twice as much Y as before. No technological advance takes place in X production. After this technological progress in the Y industry, the marginal social cost of increasing production of X from 2 units to 4 units becomes units of Y. Why do you think is the reason for this result? Food for thought: What will be the effect of a technological advance in the X industry on the marginal social cost of increasing the production of Y in terms of sacrifices of X? Why? Who knows, the questions about these reasons may come up in one of the exams. So, you'd better try to figure them out.The labor force of an island country consists of only six workers. There are only two industries in this island, one producing X (for example, goods) and the other producing Y (for example, services). The following graph shows the production possibilities frontier (PPF) for this island country. It shows the effects on the production of X and Y from shifting workers from one industry to another one worker at a time. For example, suppose that currently X = 1 and Y = 125. Now, if we transfer one worker from Y to X production, the production of X will increase to X = 2 and the production of Y will decrease to Y = 110. There are no externalities in production. Now move to Canvas. 140 135 130 125 120 115 110 105 100 95 90 85 Quantity of Y 2 3 5 Quantity of XStep by Step Solution
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