Modify Solved Problem 10.4 to show that the PPF more closely approximates a quarter of a circle if there are five people rather than three. One of the two new people, Bill, can produce five piles of wood, or four candy bars, or any linear combination. The other, Helen, can produce four piles of wood, or five candy bars, or any linear combination.

Data From Solved Problem 10.4 :-

How does the joint production possibility frontier for Jane and Denise in panel c of Figure 10.6 change if they can also trade with Harvey, who can produce 5 piles of wood, 5 candy bars, or any linear combination of wood and candy in a day?

Figure 10.6:-

Transcribed Image Text:

Firewood, Cords 2 (a) Jane MRT=-2 (b) Denise (c) Joint Production Firewood, Cords 2 3 PPF Candy, Bars 32 PPFd 2 MRT= - 6 Candy, Bars Firewood, Cords 02 O MRT: =- 6 12 (Denise) PPF MRT=-2 (Jane) 9 Candy, Bars