Consider two countries (Home and Foreign) that produce goods 1 (with labor and capital) and 2 (with labor and land). Initially, both countries have the same supply of labor (150 units each), capital, and land. The capital stock in Home then shrinks. This change shifts in both the production curve for good 1 as a function of labor employed and the associated marginal product of labor curve. Nothing happens to the production and marginal product curves for good 2. a. Show how the decrease in the supply of capital for Home affects its production possibility frontier. Using the three-point curved line drawing tool, draw a new PPF for Home that reects the decrease in the supply of capital. Properly label the curve. Carefully follow the instructions above and only draw the required object. Home 150 Output of good 2 150 PPFO Output of good 1