Assignment:
1. Assume that Guatemala produces either 1000 pounds of coffee or 3000 pounds of sugar in a year. Describe in words what the graph of the PPC would look like. (If you have the capability to upload a graph that you drew feel free to do so. I have not found a way for students to draw graphs in Canvas.)
2. Now assume that only one thing has changed. Guatemala switches its production to new insect-resistant coffee plants. How would you show this on the PPC? That is, how is this new PPC different from your original one?
3. Going back to the original PPC in the first question, there is now a new change. New technology in the sugar refining sector has allowed Guatemala to increase its annual production of sugar to 4000 pounds. How would you show this on the PPC? That is, how is this new PPC different from your original one?
4. Going back to the original PPC in the first question, there is now a new change. An influx of immigrants has allowed all sectors of the economy to increase employment. How would you show this on the PPC? That is, how is this new PPC different from your original one?
5. Describe the circular flow model. Who are the economic actors? Where and how do they interact? What does this model tell us about the macroeconomy?