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January 19, 2018 

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INDIFFERENCE MAP: A graph of two or more indifference curves. Higher indifference curves are associated with higher levels of utility.

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Lesson 4: Production Possibilities | Unit 5: Investment Page: 21 of 24

Topic: Bundle Choices: E <=PAGE BACK | PAGE NEXT=>

Now with bundle E (410 jogging shoes and 4 calibrators).
  • Producing 4 calibrators has added to the economy's quantity of capital.
  • The cost of these 4 calibrators is 40 pairs of shoes.
  • Expanding the quantity of our capital has increased resources and shift the production possibilities curve.
  • Tomorrow's production possibilities curve is farther out than today's curve. There is growth and a shift in the curve.

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INVESTMENT BORROWING

The acquisition of funds through the financial markets by the business sector which are used to finance investment expenditures on capital goods. In terms of the simple circular flow model, this is one of two basic demands for household saving diverted into financial markets. The other is government borrowing.

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PURPLE SMARPHIN
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Today, you are likely to spend a great deal of time lost in your local discount super center looking to buy either a computer that can play music and burn CDs or a T-shirt commemorating last Friday (you know why). Be on the lookout for attractive cable television service repair people.
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The portion of aggregate output U.S. citizens pay in taxes (30%) is less than the other six leading industrialized nations -- Britain, Canada, France, Germany, Italy, or Japan.
"You are never given a dream without also being given the power to make it true."

-- Richard Bach, Author

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Strongly Pareto Optimal
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