Referring to the table, suppose improvement occurs in the technology of producing forklifts but not in the technology of producing automobiles. Draw the new production possibilities curve. Now assume that a technological advance occurs in producing automobiles but not in producing forklifts.
Draw the new production possibilities curve. Now draw a production possibilities curve that reflects technological improvement in the production of both goods.
Production Alternatives
TYpes of Production A B C D E
Automobile 0 2 4 6 8
Forklifts 30 27 21 12 0

David consumes two things: gasoline (g) and bread (b). david's utility function is u(g, b) = 10g^0.25 b^0.75. use the lagrange technique to solve for david's optimal choices of gasoline and bread as a function of the price of gasoline, p_g, the price of bread, p_b, and his income m. with recent decrease in the price of gasoline (maybe due to external shock such as shale gas production) does david increase his consumption of gasoline? for david, how does partial differential g/partial differential p_g depend on his income m? that is, how does david's change in gasoline consumption due to an increase in the price of gasoline depend on his income level? to answer these questions, find the cross-partial derivative, |partial differential^2 g/partial differential m partial differential p_g.