Answer to Question #88996 in Microeconomics for Naledi

Question

1.1 Construct a production possibility frontier to illustrate Tom’s earnings potential between the two careers if initially he was not working as a carpenter, then he worked one week per month, then two, then three and finally four weeks per month (assuming only four weeks in a month).

Answer 1

The production possibility frontier in this case is a line which shows the potential combinations of working on both positions and the maximal possible amount earned. If y-axis is working as lecturer and x-axis is working as carpenter, then this curve will start at the point (0; R20000) and will end at the point (R16000; 0), if there is 20 working days per month (5 per week).