-Suppose Puerto Rico and Hawaii Currently Have the Same Production

question 5

Multiple Choice

-Suppose Puerto Rico and Hawaii currently have the same production possibilities so that the above figure is the PPF for hotels and consumption goods in the two areas.Hotels are a capital good that,once built,will help produce still more consumption goods..According to the figure,which island will have more rapid economic growth?

• A) Hawaii
• B) Both Hawaii and Puerto Rico will grow at the same speed.
• C) Puerto Rico
• D) Neither Hawaii nor Puerto Rico will grow.
• E) More than one of the above answers is correct.