Suppose Sarah and Julia both work at a bakery making bread and muffins. In an hour, Sarah can either make 10 loaves of b
Posted: Mon Mar 21, 2022 4:28 pm
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 [5 marks] b) What is the opportunity cost
to each of making one loaf of bread? [5 marks] 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. [10
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 [5 marks] b) What is the opportunity cost
to each of making one loaf of bread? [5 marks] 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. [10