The Four-Quadrant Diagram: In drawing the diagram, it was assumed that capital is specific to the clothing sector, the land is the factor specific to the food sector, and labor is mobile between sectors.

Now suppose that the economy experiences an increase in the supply of labor instead of capital 1. Draw in the shift(s) in the total product of labor curve(s) and the resulting shift in the production possibilities frontier 2. Assuming homothetic tastes, what happens to the relative price of clothing? 3. What happens to the allocation of labor between the sectors?