Question 2: Grossman Model Let's consider a simplified version of the Grossman model. Suppose, people don't work and earn no income, and that the health and home good only depend on time. So Mr =jt = O and TW = 0. We also ignore the dynamics, and hence the time subscripts, and assume that the production functions of health, H, and the home good, 2, take the following form: H=6* TH+16 2=TZ Where TH and T2 denote the time spent on healthy activities and leisure activities. Finally, we assume that time sick, TS, equals: T5=24H Qa: Derive and draw the production possibility frontier (PPF) along with points A,C, E from the class discussion in a diagram with time on leisure activities, TZ, on the vertical axis and time on healthy activities, TH, on the horizontal axis. Qb: Suppose preferences are given by 1 u=Tz+Z*TH What is the optimal time mix of health and the home good? Add the indifference curve and the optimal time bundle to the figure from Qa