Suppose that at current factor prices cloth is produced using 40 hours of labor for each acre of land, and food is produced using only 8 hours of labor per acre of land.
a. Suppose that the economy's total resources are 320 hours of labor and 20 acres of land. Use a diagram and some algebra to determine the allocation of resources. (It doesn't necessarily have to be to scale.)
b. Say there is a bumper crops in births for some astrological reason, and the labor force increases 10% from 320 hours to 352 hours. Amend the diagram and use similar algebra to figure out what happens again.