1. Amy and Garret just moved to Florida. Unaccustomed to the local fauna, they team up with local...

Question

1. Amy and Garret just moved to Florida. Unaccustomed to the local fauna, they team up with local animal control. One day per weekend, they set about catching rogue alligators and pythons in the canals around their home, and they surrender the animals to the authorities for an honorarium. These are their production possibilities per day:
Alligators Pythons Amy 2 8 Garret 4 10
Let's suppose that they initially split their time even y between catching alligators and snaring pythons and pool their spoils at the end of the day.
(a) Draw their individual PPFs, with alligators (A) on the horizontal axis and pythons (P) on the vertical. Mark their initial production points. How many alligators and pythons are they catching together?

005_z0yia5o-tx12kz5j.docx

David · Accepted Answer

Solutions:
1. a) 
Amy and Garret will catch a total of 18 pythons and 6 alligators all together.
b) Garret has absolute advantage in catching both alligators and pythons as she is catching more of both animals with same resources.
c) 
This joint PPF represents a constant opportunity cost for both Amy and Garret.
d) Amy’s Opportunity costs:
Of catching alligator = 8/2 = 4
Of catching pythons= 2/8 = 0.25
Garret’s opportunity costs:
Of catching alligators= 10/4 = 2.5
Of catching pythons= 4/10 = 0.4
e) Since garret has lower opportunity cost of catching alligator and Amy has lower opportunity cost of catching pythons; therefore, Amy should catch pythons and Garret should catch alligators.

1. Amy and Garret just moved to Florida. Unaccustomed to the local fauna, they team up with local animal control. One day per weekend, they set about catching rogue alligators and pythons in the...

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