Suppose that there are two goods in the world: bread and cheese. Without trade, David can bake 50 loaves of bread in a week. Alternatively, he can make five kg of cheese in a week. Laura can make 20 kg of cheese in one week, or she can bake 10 loaves of bread in one week. Draw the production possibilities frontiers for David and for Laura, assuming that the frontiers are linear.

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The Answer of Suppose that there are two goods in the world: bread and cheese. Without trade, David can bake 50 loaves of bread in a week. Alternatively, he can make five kg of cheese in a week. Laura can make 20 kg of cheese in one week, or she can bake 10 loaves of bread in one week. Draw the production possibilities frontiers for David and for Laura, assuming that the frontiers are linear.

Suppose That There Are Two Goods in the World: Bread