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Home produces two goods, computers and wheat, for which capital is specific to com-puters, land is specific to wheat, and labor is mobile between the two industries
Home produces two goods, computers and wheat, for which capital is specific to com-puters, land is specific to wheat, and labor is mobile between the two industries. Home
has 100 workers and 100 units of capital but only 10 units of land.(a) Draw a graph similar to Figure 3-1(a) with the output of wheat on the verticalaxis and the labor used in wheat on the horizontal axis. What is the relationshipbetween the output of wheat and the marginal product of labor in the wheatindustry as more labor is used?
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