Question

Consider a firm operating two plants. It can produce good X and Y in either plant, and the PPF of each plant is listed below.
out of Select one: a. 00 . bo C. 2 . d. 0.5 n7 The MRT of Plant 2, defined as what we usually do, the amount of Y for each un
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Answer #1

Sol :

1. Option (b) is correct (200 , 400)

As , it is calculated as follows :

Plant 1 : y1 = 100 - 0.5x1

Plant 2 : y2 = 400 - 0.1x22

In case of plant 1 , only x1 is produced so

0.5 x1 = 100

X1 = 100/0.5

X1 = 200

In case of plant 2 , only y1 is produce so

Y2 = 400

(note : as per the policy we have to solve only one question. So , for remaining question , please post in teh separate post. )

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