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Y = 0.4L Y$ = 0.8L² Y = 0.5L Y$ = 0.5LS,

Y = 0.4L Y$ = 0.8L² Y = 0.5L Y$ = 0.5LS,

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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When given this information (Y denotes output and L denotes hours of Labour. T is for traded goods and N is for non-traded goods), how do I work out the price level p£ and p$?

Initially I said p£=0.4/0.8= 0.5 and p$=0.8/0/4=2 which I don't think is correct, as then the price of non-traded goods is really small for both £ and $.

​​​​​​​Please can someone help me with working out the price level p£ and dollar level p$. Thanks​​​​​​​

Y = 0.4L Y = 0.8L Y = 0.5L% Y$ = 0.5L
Transcribed Image Text:Y = 0.4L Y = 0.8L Y = 0.5L% Y$ = 0.5L
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