)

On an island economy, Lanai has 80 units of labor, and can produce x using x = 0.5Lx, and y using y = 0.25Ly, where Lx and Ly are labor for sectors x and y. The equation of the PPF is ____, and if Lanai only likes to consume x, she will produce x = ____.

a) 2x + 4y = 80; 40

b) 2x + 4y = 80; 20

c) 6x + 2y = 120; 40

d) 6x + 2y = 120; 20

B)

Consider Lanai's economy from the above question. Say Lanai is only producing good x. Then she decides to decrease x production by exactly 1 unit. How much y will she produce as a result?

a) 0.5

b) 1.0

c) 1.5

d) 2.5

Solve clearly & typed ans only