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?

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?

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter2: Choice In A World Of Scarcity

Section: Chapter Questions

Problem 13RQ: Explain why societies cannot make a choice above their production possibilities frontier and should...

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