.

a. Assuming a competitive market, what would the wage rate be in the H-sector? Explain.

b. Assuming a competitive market, what would the wage rate be in the G-sector? Explain.

c. Assuming a competitive market, should the wage rates be equal (and are they equal?) across the two sectors?

Explain. Assume that the islanders split all production equally.

d. What is the aggregate wage in this economy?

Explain.

e. Does the aggregate wage equal the aggregate marginal product of labor? Explain.

Production Population: Assume for now that each family/tribe has 4 adult, able-bodied people in it. Time Allocation to Production: Each family on the island agrees to spend 40 hours a week in food production, L. Input Allocation: The families agree they'll split their time 50:50 on both production activities: hunting (H) and gathering (G). Output: At the end of the week we find that a Family A produced 20 H and 10 G. a Family B produced 5 H* and 10 G*