Consider a simple economy of Korea - producing two goods, Motor bike and milk. The details of the economy and its production is as follows: Motor Bike (1000 / year) Milk (1000 gallons per year) 0 60 1 50 2 30 3 0 d) According to the (BGH) technology, farmers can now get double the amount of milk from cows easily. In terms of PPF, this means Korean economy can now produce twice milk at each level of bike output. With the current production of 2000 motor bikes, Mr. B claims that this new technology can allow this economy to produce more milk and more bikes. Do you agree with this statement or not? e) Explain carefully, with the help of diagram and justify your answer.
Consider a simple economy of Korea - producing two goods, Motor bike and milk. The details of
the economy and its production is as follows:
Motor Bike (1000 / year) Milk (1000 gallons per year)
0 60
1 50
2 30
3 0
d) According to the (BGH) technology, farmers can now get double the amount of milk from
cows easily. In terms of
each level of bike output. With the current production of 2000 motor bikes, Mr. B claims
that this new technology can allow this economy to produce more milk and more bikes. Do
you agree with this statement or not?
e) Explain carefully, with the help of diagram and justify your answer.
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