QUESTION 1. Over dinner, your friend mentions an article about a population explosion in Malaysia and claims that this will dramatically alter production patterns in Malaysia. Suppose that at current factor prices Malaysian cloth is produced using 20 hours of labor for each acre of land and Malaysian food is produced using only 5 hours of labor per acre of land. 1. Suppose that the economy's total resources are 600 hours of labor and 60 acres of land. Use a box diagram to determine the allocation of resources. 2. Now suppose that the labor supply increases first to 1000 and then to 1200 hours. Using a box diagram as in the lecture, trace out the changing allocation of resources. Is the logic behind your friend's claim sound, according to the Heckscher-Ohlin model? 3. Your friend then ponders what would happen if the labor supply were to increase even further and asks what you think. So, what would the Heckscher-Ohlin model suggest would happen?
QUESTION 1. Over dinner, your friend mentions an article about a population explosion in Malaysia and claims that this will dramatically alter production patterns in Malaysia. Suppose that at current factor prices Malaysian cloth is produced using 20 hours of labor for each acre of land and Malaysian food is produced using only 5 hours of labor per acre of land. 1. Suppose that the economy's total resources are 600 hours of labor and 60 acres of land. Use a box diagram to determine the allocation of resources. 2. Now suppose that the labor supply increases first to 1000 and then to 1200 hours. Using a box diagram as in the lecture, trace out the changing allocation of resources. Is the logic behind your friend's claim sound, according to the Heckscher-Ohlin model? 3. Your friend then ponders what would happen if the labor supply were to increase even further and asks what you think. So, what would the Heckscher-Ohlin model suggest would happen?
Chapter2: Scarcity And Opportunity Costs
Section: Chapter Questions
Problem 7E
Related questions
Question
solve 3 part only)) hand written solve i'll give multiple upvote
![QUESTION 1.
Over dinner, your friend mentions an article about a population explosion in Malaysia and claims
that this will dramatically alter production patterns in Malaysia. Suppose that at current factor
prices Malaysian cloth is produced using 20 hours of labor for each acre of land and Malaysian
food is produced using only 5 hours of labor per acre of land.
1. Suppose that the economy's total resources are 600 hours of labor and 60 acres of land.
Use a box diagram to determine the allocation of resources.
2. Now suppose that the labor supply increases first to 1000 and then to 1200 hours. Using
a box diagram as in the lecture, trace out the changing allocation of resources. Is the logic
behind your friend's claim sound, according to the Heckscher-Ohlin model?
3. Your friend then ponders what would happen if the labor supply were to increase even
further and asks what you think. So, what would the Heckscher-Ohlin model suggest
would happen?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F236725c5-09a4-4abd-bc9c-8b743444ce81%2Fd5c0caa2-42f9-4c5f-b3df-f1683c91d6c5%2F61o8t8l_processed.png&w=3840&q=75)
Transcribed Image Text:QUESTION 1.
Over dinner, your friend mentions an article about a population explosion in Malaysia and claims
that this will dramatically alter production patterns in Malaysia. Suppose that at current factor
prices Malaysian cloth is produced using 20 hours of labor for each acre of land and Malaysian
food is produced using only 5 hours of labor per acre of land.
1. Suppose that the economy's total resources are 600 hours of labor and 60 acres of land.
Use a box diagram to determine the allocation of resources.
2. Now suppose that the labor supply increases first to 1000 and then to 1200 hours. Using
a box diagram as in the lecture, trace out the changing allocation of resources. Is the logic
behind your friend's claim sound, according to the Heckscher-Ohlin model?
3. Your friend then ponders what would happen if the labor supply were to increase even
further and asks what you think. So, what would the Heckscher-Ohlin model suggest
would happen?
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
![Economics:](https://www.bartleby.com/isbn_cover_images/9781285859460/9781285859460_smallCoverImage.gif)
![Brief Principles of Macroeconomics (MindTap Cours…](https://www.bartleby.com/isbn_cover_images/9781337091985/9781337091985_smallCoverImage.gif)
Brief Principles of Macroeconomics (MindTap Cours…
Economics
ISBN:
9781337091985
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
![Essentials of Economics (MindTap Course List)](https://www.bartleby.com/isbn_cover_images/9781337091992/9781337091992_smallCoverImage.gif)
Essentials of Economics (MindTap Course List)
Economics
ISBN:
9781337091992
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
![Economics:](https://www.bartleby.com/isbn_cover_images/9781285859460/9781285859460_smallCoverImage.gif)
![Brief Principles of Macroeconomics (MindTap Cours…](https://www.bartleby.com/isbn_cover_images/9781337091985/9781337091985_smallCoverImage.gif)
Brief Principles of Macroeconomics (MindTap Cours…
Economics
ISBN:
9781337091985
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
![Essentials of Economics (MindTap Course List)](https://www.bartleby.com/isbn_cover_images/9781337091992/9781337091992_smallCoverImage.gif)
Essentials of Economics (MindTap Course List)
Economics
ISBN:
9781337091992
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
![Micro Economics For Today](https://www.bartleby.com/isbn_cover_images/9781337613064/9781337613064_smallCoverImage.gif)
![Survey Of Economics](https://www.bartleby.com/isbn_cover_images/9781337111522/9781337111522_smallCoverImage.gif)
![Principles of Economics 2e](https://www.bartleby.com/isbn_cover_images/9781947172364/9781947172364_smallCoverImage.jpg)
Principles of Economics 2e
Economics
ISBN:
9781947172364
Author:
Steven A. Greenlaw; David Shapiro
Publisher:
OpenStax