Unemployment is reduced due to the measures taken by the government. State its economic value in the context of production possibilities frontier.
As initially, the production in the economy is below its potential due to unemployment, this suggests that the economy is operating at a point below the Production Possibility curve (PPC). As the government starts employment generation schemes, the unemployed resources get utilized. In a situation of full employment the economy would move to a point on the PPC. Hence, economic value is reflected in terms of increased output and income.
A consumer buys 18 units of a good at a price of Rs. 9 per unit. The price elasticity of demand for the good is (−) 1. How many units the consumer will buy at a price of Rs. 10 per unit? Calculate.