Global Material Economics

Suppose that there are two products: clothing and soda. Both Brazil and the United States produce each product. Brazil can produce 100,000 units of clothing per year and 50,000 cans of soda. The United States can produce 65,000 units of clothing per year and 250,000 cans of soda. Assume that costs remain constant. For this example, assume that the production possibility frontier (PPF) is a straight line for each country because no other data points are available or provided. Include a PPF graph for each country in your paper. Chapter 5 of the Suranovic text is a good reference for this task.

Complete the following:

  • Denote these points on each COUNTRY’s production possibility frontier.


  • What is the labor-intensive good?
  • What is the Marginal Rate of Transformation impact?
  • What is the labor-abundant country?
  • What is the capital-abundant country?