Suppose at current factor prices a country’s manufactures use 60 hours of labor for each acre of...

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Suppose at current factor prices a country’s manufactures use 60 hours of labor for each acre of land and food is produced using only fifteen hours of labor per acre of land. If the economy’s total resources are 1800 hours of labor and 180 acres of land, how much labor and land are allocated to manufacture and food production respectively? If the labor supply grows 50%, what happens to the allocation?

David · Accepted Answer

Suppose at current factor prices a country’s manufactures use 60 hours of labor for each acre of land and 
food is produced using only fifteen hours of labor per acre of land. If the economy’s total resources are 1800 
hours of labor and 180 acres of land,

Suppose at current factor prices a country’s manufactures use 60 hours of labor for each acre of land and food is produced using only fifteen hours of labor per acre of land. If the economy’s total...

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