Problem
An economy consists of two consumers ( Julie and Carina), each consuming positive amounts of two goods, food and clothing. Food and clothing are both produced with two inputs, capital and labor, using technologies exhibiting constant returns to scale. The following information is known about the current consumption and production baskets: The marginal cost of producing food is $2, and the price of clothing is $4. The wage rate is 2/3 the rental price of capital, and the marginal product of capital in producing clothing is 3. In a general competitive equilibrium, what must be
a) The price of food?
b) The marginal rate of transformation of food for clothing?
c) The shape of the production possibilities frontier for the economy?
d) The marginal product of labor in producing clothing?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.