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a) Suppose capital and labor are perfect substitutes in production for clothing: 2 units of capital or 2 units of labor produce 1 unit of

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a) Suppose capital and labor are perfect substitutes in production for clothing: 2 units of capital or 2 units of labor produce 1 unit of clothing. Suppose capital and labor are perfect complements in production for food: 1 unit of capital and 1 unit of labor produce 1 unit of food. Suppose the economy has an endowment of 100 units of capital and 200 units of labor. Construct the production possibilities frontier for the economy. plot the production possibilities (plot 2 points) curve. What is the opportunity cost of food in terms of clothing? b) Chun can make 5 units of food per day if he devotes all his time to food production. He can make 10 units of clothing if he spends the whole day at clothing production. If he divides his time between the two activities, his output of each good will be proportional to the time spent on each. The corresponding figures for Friday are 10 units of food and 15 units of clothing. Plot the production possibilities frontier for their economy. plot the production possibilities frontier (plot 3 points) curve

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