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Question : Robinson has a production function of 2C+F=8 and Friday has : 4714

Robinson has a production function of 2C+F=8 and Friday has a production function of C+F=4. The opportunity cost for Robinson is 1F=.5C and 1C=2F. Friday has an opportunity cost of 1F=1C. If each specialize Robinson will produce C and Friday will produce F. How do you determine how much each will produce after they specialize? How do you determine how much each will trade and what happens after trade?

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Solution
5 (1 Ratings )

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