Home has 1,200 units of labor available. It can produce two goods, apples and bananas. The unit labor requirement in apple production is 3, while in banana production it is 2. a. Graph Home’s production possibility frontier. b. What is the opportunity cost of apples in terms of bananas? c. In the absence of trade, what would the price of apples in terms of bananas be? Why? 2. Home is as described in problem 1. There is now also another country, Foreign, with a labor force of 800. Foreign’s unit labor requirement in apple production is 5, while in banana production it is 1.
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Home has 1,200 units of labor available. It can produce two goods, apples and bananas.
The unit labor requirement in apple production is 3, while in banana production it is 2.
a. Graph Home’s production possibility frontier.
b. What is the
c. In the absence of trade, what would the price of apples in terms of bananas be?
Why?
2. Home is as described in problem 1. There is now also another country, Foreign, with a
labor force of 800. Foreign’s unit labor requirement in apple production is 5, while in
banana production it is 1.
a. Graph Foreign’s production possibility frontier.
b. Construct the world relative supply curve.
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- question 2 Home has 1200 units of labor available. There can produce two goods which watermelon and kiwi. The unit labor requirement in watermelon production is 3, while in kiwi production it is 2. a) When all the labor only produce watermelon, how many units of watermelon can be produce? b) When all the labor only produce kiwi, how many units of kiwi can be produce? c) What is the opportunity cost of watermelon in terms of kiwi? d) In the absence of trade, what would be the price of watermelon in terms of kiwi? Why?Q3. Home has 1,200 units of labor available. It can produce two goods, apples and bananas. The unit labor requirement in apple production is 3, while in banana production it is 2. a. Draw Home's production possibility frontier. Label the curve PPF. (Clearly show the maximum amount of the two goods that can be produced on your graph) b. What is the opportunity cost of apples in terms of bananas? (Enter your response rounded to one decimal place.) c. In the absence of trade, what would the price of apples in terms of bananas be? There is now also another country, Foreign, with a labor force (L) of 800. Foreign's unit labor requirement in apple production is 5, while in banana production it is 1. d. Derive the equation for Foreign's production possibility frontier. e. Graph Foreign’s production possibility frontier.Two countries, Pakistan and India, produce two commodities: apples and mangoes. The amount of each commodity produced per hour, in kg, for Pakistan is: 6 apples, and 6 mangoes. Meanwhile, it is 5 apples and 4 mangoes for India. a.) What is the opportunity cost for mangoes in the two countries? How does it differ from relative price? Explain.
- 1. Home has 1,200 units of labor available. It can produce two goods, apples and bananas.The unit labor requirement in apple production is 3, while in banana production it is 2.a. Graph Home’s production possibility frontier.b. What is the opportunity cost of apples in terms of bananas?c. In the absence of trade, what would the price of apples in terms of bananas be?Why?2. Home is as described in problem 1. There is now also another country, Foreign, with alabor force of 800. Foreign’s unit labor requirement in apple production is 5, while inbanana production it is 1.a. Graph Foreign’s production possibility frontier.b. Construct the world relative supply curve.3. Now suppose world relative demand takes the following form: Demand for apples/demandfor bananas = price of bananas/price of apples.a. Graph the relative demand curve along with the relative supply curve.b. What is the equilibrium relative price of apples?c. Describe the pattern of trade.d. Show that both Home and Foreign gain…What is the opportunity cost of obtaining more of one good, as it relates to the production possibilities frontier? the amount of the other good that must be given up the market price of the additional amount produced the amount of resources that must be devoted to its production the number of dollars that must be spent to produce itThe graph to the right depicts an economy, Home, which produces flowers and soybeans. Its production possibilities frontier is shown as TT. One of Home's isovalue lines is also shown as VV. Ps = $2 ... the price of a unit of soybeans Q = 5 ... the number of units of soybeans currently being produced at point X P $2... the price of a unit of flowers = Q₁ = 5... the number of units of flowers currently being produced at point X. What is the significance of Home operating at point X on the graph to the right? A. It maximizes Home's value of output. B. It minimizes Home's total cost of production. OC. It maximizes Home's profit. OD. It maximizes the utility of Home consumers. C Production of soybeans, Qs 16- 15- 14- 13- 12- 11- 10- 7- Home Production 6- ☑ 5- 4- 3- 2- 1- 0- TT ⚫JVV 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Flower production, Qf
- the production of the two goods (all units are measured in millions of tons) Opportunity Cost of Good X Good X Good Y Production Possibility 0. 100 2 90 4 60 20 a) Calculate the opportunity cost of the production of good X at each point. What law does the trend in those values exhibit? b) What changes are required for this economy to shift the PPF outward? 7. The market for iemon has 10 potential consumers, each having an individual demand curve P = 101 - 100, where P is price in dollars per cup and O, is the number of cups demanded per week by the i consumer. Find the market demand curve using algebra. Draw an individua! demand curve and the market demand curve. What is the quantity demanded by each consumer and in the market as a whole when lermon is priced at P = $1/cup? 8 The demand fer tickets to an Ethiopian Camparada film is given by D (p) = 200,000- 10,000p, where p is the price of tickets. If the price of tickets is 12 birr, calculate price elasticity of demand for tickets and…As the manager at a local florist, you supervise two employees, Anita and Jerome. There are two tasks that need to be completed: floral arrangements and flower delivery. It takes Anita 30 minutes to finish one floral arrangement and it takes her 40 minutes to make one delivery. It takes Jerome 10 minutes to finish one floral arrangement and it takes him 30 minutes to make one delivery. a. Who has a comparative advantage in floral arrangements? What about deliveries? b. Suppose, initially, Jerome and Anita each spent 4 hours each day doing floral arrangements and 2 hours each day doing deliveries. If you changed their tasks so that each individual did nothing but the task for which they had a comparative advantage, how many more floral arrangements would your store make, and how many more deliveries?I am eight hour day Andy can produce either 24 loaves of bread or 8 kilograms of butter. In an eight hour day Rolfe can produce either 8 loaves of bread or 8 kilograms of butter. a)what is Andy's opportunity cost of producing one loaf of bread? What is rolfes opportunity cost of producing one loaf of bread b) who has the comparative advantage in bread production? Who has comparative advantage in butter production? c)would they both gain from specialization and trade in other each other? Show it through a numerical example
- ple Choice ý the letter of the choice that best completes the statement or answers the question. 1. Which of the following is an example of lower production costs brought about by the use of technology? the delivery costs of gasoline to the consumer by diesel trucks the use of e-mail to replace slower surface mail а. b. the making of breads and pastries in local shops rather than large bakeries the importing of fresh vegetables from South America rather than using canned vegetables- с. d. 2. What is the effect of import restrictions on prices? They cause prices to drop. b. a. They cause prices to rise. They often cause prices to rise steeply and then drop. d. They usually do not have any lasting effect on price. с. 3. What do sellers do if they expect the price of goods they have for sale to increase dramatically in the future? sell the goods now and try to invest the money instead of resupplying sell the goods now but try to get the higher price for them store the goods until the…og and Study Tools Options ge Success Tips er Success Tips 7.Specialization and production possibilities Suppose Germany produces only camcorders and trucks. The resources that are used in the production of these two goods are specialized-that is, some resources are more suitable for producing camcorders than trucks, whereas others are mare suitable for producing trucks than camcorders The shape of Germany's production possibilities frontier (PP) should reflect the fact that as Germany produces more tricks and fewer camcorders, the opportunity cost of producing each additional truck, The following graphs show be possible PPPs for Germany's economy: a straight-line PPF (PPF) and a bowed out PP (PPP)) CAMCORDERS TRUCKS CAMCORDERS p Graph 2 TRUCKS Based on the previous description, the tradeoff Germany faces between producing trucks and camcorders is best represented by A-2 1 DP corporations tments to core to earn a relatively nd to other marketa. Can point D be produced? Why?. b. What variable might shift the curve PPC1 to PPC2? What would cause the curves to meet at 40,000 quantities of butter produced? What does point E represent? C. d. Explain the movement from point A to B for the production of these two goods ?