e) Determine the acceptable range of prices in terms of the trading price for 1 fish in terms of units of seaweed. Determine the acceptable range for 1 unit of seaweed in terms of fish. 1 fish = to J units of seaweed 1 unit of seaweed = [_ to fish f) Using the information in the table given in the question prompt draw each person's PPF in the spaces below. 5 Fish Fish Fish Fish . .. . :... .:....... .:..... ...:.. . S. . . . ... 3 . . . . . . . . ...: ... 2 . ... -. . ... ..... ... ... .... . ....1... ..!... Scaweed Seaweed Seaweed g) Draw the joint PPC below for Maldives. Hint: use your best judgement and remember that the points on the PPC are efficient points - which combination of resources result in the most output. Consider only whole units of output for each of the points on the PPC. 5 Fish A Seaweed Page 4 of 7b) What are the opportunity costs of catching fish for each person in terms of seaweed? What are the opportunity costs of collecting seaweed for each person in terms of fish? Put your answers in the following table. UI Opportunity Cost Opportunity Cost of Fish of Seaweed Anna 3 Chris 5 2 Sandra Joe 3 5 c) Find who has the absolute advantage in catching fish/collecting seaweed? Assume each has just one level of oxygen and then using the table given in the question prompt - complete the table below: Anna Chris Sandra Joe Oxygen Tank Level Total amount of caught fish Total amount of collected seaweed 3 d) Using your opportunity cost table in part b), find who has the comparative advantage in catching fish/collecting seaweed? Opportunity Cost Opportunity Cost of Fish of Seaweed Anna Chris Sandra Joe Page 3 of 7QUESTION 2 (20 marks) Maldives is a deserted island economy with a total of four people: Anna, Chris, Sandra and Joe. The inhabitants are only able to produce two goods in their economy - fish and seaweed. Both goods are obtained from open water diving and require the use of a scuba tank. Luckily, they found four of these tanks, one for each of them, that were left behind by previous visitors to the island. Moreover, they were fortunate to find that each tank comes with a gadget that allows them to fill the tanks with oxygen by manually pumping air into the tank. This takes quite a bit of time, and they find it best to fill these at night before they go to sleep. The gadgets are also not equally efficient at filling the tanks and they are not interchangeable - each can only be used with the specific tank it was found with. As such, in the morning the maximum level of oxygen in each person's tank differs. Thus, each person possesses a different amount of oxygen in their tanks. The following table shows the level of oxygen in each person's tank in the morning and how much is needed for each to catch each unit of food: Anna Chris Sandra Joe Oxygen Tank Level 6 10 8 15 Catching Fish (Level/Fish) 2 2 5 Collecting Seaweed (Level/Seaweed) W 5 2 3 a) If all four decide to catch only fish, how many can they all catch? If all four decide to collect only seaweed, how many can they all catch? Put your answers in the following table. N Fish Seaweed Anna Chris Sandra Joe Page 2 of 7
