Economic growth

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  1. Economic Growth Overview:
  2. 2 Factors of Economic Growth
    • Technological Change
    • Capital Accumulation
  3. How Economic Growth affects PPF
    • Chicken and Farms
    • Less consumption of chickens and more farms
    • More chickens in the future
  1. Understanding Economic Growth
    Suppose a company produces phones and laptops. The marginal cost producing each of these increases as more of it gets produced.
    1. Make a graph that illustrates the companies PPF.
    2. Suppose the company developed a new technology that uses fewer resources to create laptops. Use the graph to illustrate the impact of the new technology.
    3. What happens to the opportunity cost of producing cellphones? Has it increased, decreased, or stayed the same?
    4. Is the company more efficient with the new technology? Why or Why not?
  2. If economic growth such as capital accumulation and technological change shifts the PPF outward, allowing us to produce more and even more in the future, why do we still have scarcity?