Microeconomics

Ch1,2

PPf non linear

Production possibilities frontier(PPF): a Curve showing the maximum attainable

combinations of two products that may be produced with available resources and
current technology

Questions:-
*The efficient point : A, B
*the attainable point : A , B , C
*Inefficient point: C
*Unattainable point: D

Q: If the PPf is non- linear , the apportunity cost is ……….

Answer: Increasing and Variable

DR/ Hatem El-Waseif

31003012
 Microeconomics
Ch1,2

*Opportunity cost: the highest alternative value that must be given up to engage
in an activity.
Notes
To calculate the opportunity cost
‫نشوف السلعة اللي انخفضت وكم مقدار االنخفاض‬

Q: What is the opportunity cost if moving from x to Y ………

Answer: 40 Good A
Q: What is the opportunity cost if moving from Y to X ………
Answer: 10 Good B

DR/ Hatem El-Waseif

31003012
 Microeconomics
Ch1,2

Q
Milk Factory Hotel’s
apartment
A 95 70
B 86 74
C 110 79

Q: what is the opportunity cost if moving from B to A ……………

Answer: 4 hotel’s apartment
Q: what is the opportunity cost if increasing the milk factory by 9 units ……
Answer: 4 hotel’s apartment

Q/ In the past Factory has produce 50 Tables and 25 chairs, now the factory
producing 70 Tables and 14 chairs what is the opportunity cost
Answer/ 11 Chairs

PPf Linear
Q/ If the PPf linear, what is the apportunity cost …………..

DR/ Hatem El-Waseif

31003012
 Microeconomics
Ch1,2

Answer: Fixed
The variables that shift the PPF curve to right(outward) or left(In Ward)
1-Capital ( equipment , Machinery)
2-Labor
3-Technology
4-Economic Growth
Notes: The Wars, earthquakes ,Covid-19 , blockade on Qatar ) shift the PPF Curve
to left (inward)

Factors of production
1-Labor
2-Capital (Equipment)
3-Natural Resources ( Land , Oil and Water )
4-entrepreneur (the person who managing the factory )

DR/ Hatem El-Waseif

31003012
 Microeconomics
Ch1,2

Notes: -
Circular-flow diagram : a model that illustrates how households
and firms are linked

*Households give the Firms factor of production

*the firms give the households Goods and services

DR/ Hatem El-Waseif

31003012
 Microeconomics
Ch1,2

*The reason of Economic Problem?

1-Limited resources
2-Unlimited needs/Wants

Scarcity : the situation in which unlimited wants exceeds the limited resources

Economics: the study of the choices that people make to attain their goals, given
their resources is limited and wants unlimited

There are three ideas in the economy:-

1-people are rational ( consumers and firms using all available information as they
act to achieve their goals)
2-people respond to economic incentives)‫ حوافز‬people purchasing more in Sale
season)
3-optimal decisions are made depend on marginal (additional) ( marginal meaning
extra or additional benefit or additional cost )

Marginal analysis: comparing marginal benefits and marginal costs .

Trade off ‫المفاضلة‬
Notes:- the trade off resulting from scarcity

DR/ Hatem El-Waseif

31003012
 Microeconomics
Ch1,2

Market economies Types

1-Centrally Planned economy
Controlled by the government
2-Market economy
Controlled by Demand and supply
3-Mixed economy
Has Part controlled by government and other part controlled by Demand and
supply (Notes: Mixed economy applied in Arb countries )

Productive efficiency : When producing good and service at the lowest possible
cost
Allocative efficiency : producing good and service depend on consumer
preferences ‫تفضيالت‬

Positive analysis: ‫بيكون في شكل حقائق معروفة‬

Examples:-
When the price of good increase, the QD decrease
The unemployment rate in Doha is 15 %

Normative analysis : ‫بيكون في شكل نصائح‬

Examples:-
The government must increasing the wages
Should be

DR/ Hatem El-Waseif

31003012
 Microeconomics
Ch1,2

It’s important

Microeconomics: The study of how households and firms make choices and how
they interact in the markets.
Microeconomics including the following Topics:-
1-Demand and supply
2-Elasticity
3-the effect of Covid-19 on aviation sector

Macroeconomics: The study of the economy as a whole

Macroeconomics including the following Topics:-
1-Inflation
2-Unemployment
3-economic Growht
3-the effect of Covid – 19 on the economy of Qatar

DR/ Hatem El-Waseif

31003012
 Microeconomics
Ch1,2

DR/ Hatem El-Waseif

31003012
 Microeconomics
Ch1,2

DR/ Hatem El-Waseif

31003012
 Microeconomics
Ch1,2

Answer
1-C
2-C
3-D
4-C
5-C
6-C

DR/ Hatem El-Waseif

31003012
 Microeconomics
Ch1,2

DR/ Hatem El-Waseif

31003012