H Country produces T-shirts and Rice only. There is a total of 10 workers in H Country. The labour input, output levels of T- shirts and rice, marginal product of labour of T-shirts (MPL) and marginal product of labour of rice (MPL) are shown in the table below. Labour is the mobile factor, capital and land are the specific factors of T-shirts and rice respectively. Wage is the only cost in both sectors. The employers in both sectors will produce at the output levels that will maximize their profits. H Country is currently not trading with any other countries. Labour Input IMPL Output of RiceMPL 56 0 1 2 3 4 5 6 7 8 Output of T- shirts 0 56 86 114 140 158 174 188 198 206 210 30 28 26 18 16 (in kg) 0 70 112 150 184 212 70 42 38 34 28 26 16 14 12 6 238 14 254 268 280 286 10 8 4 9 10 Suppose the current output of rice is 268 kg and the price of rice is $56 per kg. A. Determine the current output of T-shirts? Explain. (4 marks) B. Calculate the slope of the production possibility function (with T-shirts on the y-axis and rice on the x-axis) at the current output levels of T-shirts and rice. Take 2 decimal places. (4 marks) B. Calculate the slope of the production possibility function (with T-shirts on the y-axis and rice on the x-axis) at the current output levels of T-shirts and rice. Take 2 decimal places. (4 marks) C. Calculate the unit price of T-shirts. (6 marks) D. Calculate the nominal wage per worker in the rice sector. (6 marks) E. Calculate the profit of the employers of the rice sector. (7 marks) H Country produces T-shirts and Rice only. There is a total of 10 workers in H Country. The labour input, output levels of T- shirts and rice, marginal product of labour of T-shirts (MPL) and marginal product of labour of rice (MPL) are shown in the table below. Labour is the mobile factor, capital and land are the specific factors of T-shirts and rice respectively. Wage is the only cost in both sectors. The employers in both sectors will produce at the output levels that will maximize their profits. H Country is currently not trading with any other countries. Labour Input IMPL Output of RiceMPL 56 0 1 2 3 4 5 6 7 8 Output of T- shirts 0 56 86 114 140 158 174 188 198 206 210 30 28 26 18 16 (in kg) 0 70 112 150 184 212 70 42 38 34 28 26 16 14 12 6 238 14 254 268 280 286 10 8 4 9 10 Suppose the current output of rice is 268 kg and the price of rice is $56 per kg. A. Determine the current output of T-shirts? Explain. (4 marks) B. Calculate the slope of the production possibility function (with T-shirts on the y-axis and rice on the x-axis) at the current output levels of T-shirts and rice. Take 2 decimal places. (4 marks) B. Calculate the slope of the production possibility function (with T-shirts on the y-axis and rice on the x-axis) at the current output levels of T-shirts and rice. Take 2 decimal places. (4 marks) C. Calculate the unit price of T-shirts. (6 marks) D. Calculate the nominal wage per worker in the rice sector. (6 marks) E. Calculate the profit of the employers of the rice sector. (7 marks)
