Hubert and Kate are farmers. Each one owns a 12-acre plot of land. The following table shows the amount of corn and rye each farmer can produceper year on a given acre. Each farmer chooses whether to devote all acres to producing corn or rye or to produce corn on some of the land and rye onthe rest.CornRye(Bushels per acre) (Bushels per acre)Hubert204Kate287On the following graph, use the blue line (circle symbol) to plot Hubert's production possibilities frontier (PPF), and use the purple line (diamondsymbol) to plot Kate's PPF.120108Hubert's PPF9684Kate's PPF726048RYE (Bushels) 120108Hubert's PPF968472Kate's PPF6048361260120180240300360420480540600CORN (Bushels)has an absolute advantage in the production of corn, andhas an absolute advantage in the production of rye.Hubert's opportunity cost of producing 1 bushel of rye isbushels of corn, whereas Kate's opportunity cost of producing 1 bushel of rye isopportunity cost of producing rye than Kate,has a comparativebushels of corn. Because Hubert has aadvantage in the production of rye, andhas a comparative advantage in the production of corn.RYE (Bushels)24

Given: Corn Rye Hubert 20 4 Kate 28 7

has an absolute advantage in the production of corn, and has an absolute advantage in the production of rye. Hubert's opportunity cost of producing 1 bushel of rye is bushels of corn, whereas Kate's opportunity cost of producing 1 bushel of rye is opportunity cost of producing rye than Kate, has a comparative bushels of corn. Because Hubert has a advantage in the production of rye, and v has a comparative advantage in the production of corn.

has an absolute advantage in the production of corn, and has an absolute advantage in the production of rye. Hubert's opportunity cost of producing 1 bushel of rye is bushels of corn, whereas Kate's opportunity cost of producing 1 bushel of rye is opportunity cost of producing rye than Kate, has a comparative bushels of corn. Because Hubert has a advantage in the production of rye, and v has a comparative advantage in the production of corn.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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