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The PPC, Economic Growth, & Productivity. 12.1. I. Overview:. A. Economic Growth 1. Eases poverty 2. Raises standard of living. New Orleans. B. An economy’s standard of living grows because… (p. 357) 1. 2. 3. II. PPC and Economic Growth. A. Do you remember the PPC? Assumptions?
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I. Overview: A. Economic Growth 1. Eases poverty 2. Raises standard of living New Orleans
B. An economy’s standard of living grows because…(p. 357) 1. 2. 3.
II. PPC and Economic Growth A. Do you remember the PPC? Assumptions? B. Now compare consumer goods (finished product) vs. capital goods (resources) Capital Goods Consumer Goods
C. An outward shift represents….. Why would an economy grow? What effect would this have on standard of living? *p. 359 1st paragraph under “Productivity”
III. Productivity A. Labor--measures total output divided by the hours of labor employed to produce that output B. Human & Physical Capital—(p. 360 last paragraph in that section) as an economy accumulates more human and physical capital per worker, labor productivity increases and the standard of living grows C. Rules of the Game—(p. 362 last paragraph) formal and informal institutions that provide production incentives and promote economic activity (laws, customs, etc.)
