Suppose Sarah and Julia both work at a bakery making bread and muffins. In an hour, Sarah can either make 10 loaves of bread or 40 muffins, while Julia can either make 12 loaves of bread or 60 muffins. Both Sarah and Julia work 8 hours a day. a) Draw the daily PPF for Sarah and Julia b) What is the opportunity cost to each of making one loaf of bread? c) Suppose you are the owner of the bakery. If Julia and Sarah are currently both spending all of their time making muffins, then which of them should you ask to start making bread? Explain your answer.
Suppose Sarah and Julia both work at a bakery making bread and muffins. In an hour, Sarah can either make 10 loaves of bread or 40 muffins, while Julia can either make 12 loaves of bread or 60 muffins. Both Sarah and Julia work 8 hours a day. a) Draw the daily PPF for Sarah and Julia b) What is the opportunity cost to each of making one loaf of bread? c) Suppose you are the owner of the bakery. If Julia and Sarah are currently both spending all of their time making muffins, then which of them should you ask to start making bread? Explain your answer.
Chapter2: Productions Possibilities, Opportunity Costs, And Economic Growth
Section: Chapter Questions
Problem 10SQ
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Suppose Sarah and Julia both work at a bakery making bread and muffins. In an hour, Sarah can either make 10 loaves of bread or 40 muffins, while Julia can either make 12 loaves of bread or 60 muffins. Both Sarah and Julia work 8 hours a day.
a) Draw the daily
b) What is the
c) Suppose you are the owner of the bakery. If Julia and Sarah are currently both spending all of their time making muffins, then which of them should you ask to start making bread? Explain your answer.
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ISBN:
9781337617383
Author:
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Publisher:
Cengage Learning
