Question 2 Review Econ

Question 2 Suppose the representative firm's production function is Y=z{hI), where z = total factor productivity is given. Assume there is no government sector. 3. Draw the production possibilities frontier for this econ omy. What is its slope? b. Identify.. the optimum which depicts the equilibrium of this economyI by drawing in the relevant indifference curves. What is being determined at this point and what is the condition that is being satised at this point? c. If the consumer's preferences are given by the utility function U=C|, solve for equilibrium leisure, consumption, employment, wage and output. d. Verify that, in this special model, profit is zero at the optimum