describe the short term effect in terms of the


Describe the short term effect in terms of the mix of production inputs and the overall level of output in detail of the following:

i) A drought in the Midwest which cuts the production of corn.

ii) A business failure in the area where your factory is that results in a large increase in the unemployment of unskilled workers but does not affect your overall demand.

iii) The completion of a major housing development with no accompanying increase in electrical generation capacity in the area.

iv) A technological advance in the technology of the of your production that requires an increase in the technical skills of the operators but cuts overall costs by 20%

 

Describe the long term effect in terms of the mix of production inputs and the overall level of output in detail of the following:

i) A drought in the Midwest which cuts the production of corn.

ii) A major breakthrough that allows for on-site generation of electricity for an investment in the generating capacity but after that essentially a zero variable cost of electricity.

iii) A technological advance in the technology of your production that requires an increase in the technical skills of the operators but cuts overall costs by 20%.

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Microeconomics: describe the short term effect in terms of the
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