Question

Assume a country produces haircuts and shirts with inputs of labour. The country has 1000 hours of labour available. A haircut requires ½ hour of labour, while a shirt requires 5 hours of labour.
a. Construct country’sproduction- possibility frontier. (2 marks)
b. The country is faced with massive unemployment. How will the PPF be impacted? Explain and indicate on graph.( 1mark)
c. The country discovers new technology and moves towards automation. Justify how this will impact the PPF for the economy. Also, indicate the same through the graph.

Answer 1

Answer:

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