Answer to Question #81780 in Microeconomics for AZIZBEK

Question

Now consider an economy consists of four workers: Harry, Larry, Moe, and Curly, where Harry and
Larry are brothers. Each works 10 hours a day and can produce two services: mowing lawns and washing
cars. In an hour, both Harry and Larry can either mow one lawn or wash one car; Moe can either mow
one lawn or wash two cars; and Curly can either mow two lawns or wash one car.
a. Calculate how much of each service is produced under the following circumstances, which we label
A, B, C, and D:
• All four spend all their time mowing lawns. (A)
• All four spend all their time washing cars. (B)
• All four spend half their time on each activity. (C)
• Larry and Harry spends half their time on each activity, while Moe only washes cars and Curly only
mows lawns. (D)
b. In the production possibilities frontier for this economy. how many kink points would be on your
graph?

Answer 1

a. A, B, C, and D:

• All four spend all their time mowing lawns, then A is (50 lawns; 0 cars),

• All four spend all their time washing cars, then B is (0 lawns; 50 cars),

• All four spend half their time on each activity, then C is (25 lawns; 25 cars),

• Larry and Harry spends half their time on each activity, while Moe only washes cars and Curly only mows lawns, then D is (30 lawns; 30 cars)

b. In the production possibilities frontier for this economy there would be 2 kink points C and D on your graph.