Microeconomics Answer 2022

Running head: Microeconomics
Microeconomics
Name of the Student
Name of the University
Student ID

Microeconomics1
Table of Contents
Answer 1..........................................................................................................................................2
Answer 2..........................................................................................................................................3
Answer 3..........................................................................................................................................4
Answer 4..........................................................................................................................................5
References........................................................................................................................................7

Microeconomics2
Answer 1
(a) The mining industry in Australia faces scarcity of available mines and thus to increase yield
the mining industry have two choice options one is using of more advanced technology that
improves extraction of current mines and the other is discovery of new mines (1). Thus, to
choose the best option the mining industry needs to compare the opportunity cost of the choices
and opts the choice with lower opportunity cost.
(b) Fundamental economics questions are what to produce, how to produce and for whom to
produce. These questions are valid for production of any good including an economics textbook.
Before starting production of economics textbook it is important to find what type of economics
textbook is required to produce that is if its macroeconomics or microeconomics, how to produce
that book means which writer is to be contacted and how will be quality of the books (2). All
these question are further based on the target reader of the books if it’s for high school students
or graduate school students. Putting up answers of all the three questions together will solve the
problem of production of economics textbook.
(c) Production possibility frontier represents the trade-off between opportunity costs of two
alternative choices. It is downward sloping because by making one choice one has to sacrifice
the other possible choice and thus a gain and loss trade-off is associated (3). A PPF is concave to
the origin because an increase in consumption or production of a good increases its opportunity
cost.
(d) Two reasons that shift the PPF inward are (i) decline in skill and (ii) fall in available factors
of production.