Suppose you and a friend are stranded on an island and must gather firewood and catch fish

Question:

Suppose you and a friend are stranded on an island and must gather firewood and catch fish to survive. Through experience, you know that if each of you spends an entire day on either activity, the result is given in the following table:

image text in transcribed
You and your friend decide that you should each specialize so that one person catches fish while the other gathers firewood. But who should do which task?
a. What is the opportunity cost for you to gather an additional bundle of firewood? What is your friend's opportunity cost of gathering an extra bundle of firewood?
b. Assuming that you and your friend specialize, what allocation of tasks maximizes total output for your one day of joint effort?
c. Suppose you both decide to work for two days according to the allocation in part (b). What is the total amount of output? What would it have been had you chosen the reverse allocation of tasks?
Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Microeconomics

ISBN: 978-0321866349

14th canadian Edition

Authors: Christopher T.S. Ragan, Richard G Lipsey

Question Posted: