A company invents a new battery that is twice as efficient as any other and its performance is expected to double again every two years. However, its design is proprietary and can only be used in the company's own exclusive line of electric cars. Based on this description, which essential characteristic of a foundational, economy-wide transformative technology is this invention lacking?

An individual is making a decision about how to allocate their resources between two time periods. The standard diagram for this choice places 'consumption now' on the horizontal axis and 'consumption later' on the vertical axis. If this individual decides to consume $40 in the present and save the remaining $60 for the future, which coordinate pair correctly represents this consumption plan on the diagram?

Comparing Intertemporal Consumption Plans

Analyzing Trade-offs in Consumption Choices

In a diagram where an individual's consumption choices are plotted with 'consumption now' on the horizontal axis and 'consumption later' on the vertical axis, a move from point A (40, 60) to point B (50, 50) represents an increase in current savings.

An individual has a total of $100 to spend over two periods, 'now' and 'later'. Their consumption plan is represented by a coordinate pair (consumption now, consumption later) on a diagram where the horizontal axis measures consumption now and the vertical axis measures consumption later. Assuming the individual cannot borrow and there is no interest, which of the following consumption plans is impossible?

Analyzing Intertemporal Consumption Trade-offs

An individual's plan for spending over two time periods, 'now' and 'later', can be shown on a diagram. The amount spent 'now' is on the horizontal axis, and the amount available to spend 'later' is on the vertical axis. Each plan is a point on the diagram, with the format (spending now, spending later). Match each consumption plan to the description of the individual's behavior.

In a diagram where an individual's consumption choices are plotted with 'consumption now' on the horizontal axis and 'consumption later' on the vertical axis, any point where the value on the horizontal axis is greater than the value on the vertical axis represents a decision to prioritize saving for the future over current spending.

An individual is allocating a budget between two periods: 'now' and 'later'. Their choices are plotted on a diagram with 'consumption now' on the horizontal axis and 'consumption later' on the vertical axis. Starting from an initial plan of (50, 50), which of the following alternative plans represents the largest sacrifice in future consumption for a $10 increase in current consumption?

Analyzing Trade-offs in Consumption Choices