05-02_task1

Economics © ACCESS Virtual Learning 2023 Name: Joseph Stephens Date: 12/12/23 School: GSHS Facilitator: Nelson 5.02 Specialization and Comparative Advantage (48 Points) Part 1: “Other Goes Over” 1. Using the “Other Goes Over” Method presented to you in the lesson, complete the chart parts A-D for Country Y and Country Z for both peanuts and bats. Reduce the fractions so you can compare the output of the nations. (2 points each; 8 points total) Peanuts Bats Country Y 15 60 a) 4 (show the “other goes over” fraction) b) 1/4 (show the “other goes over” fraction) Country Z 10 80 c) 8 (show the “other goes over” fraction) d) 1/8 (show the “other goes over” fraction) Part 2: Using the Chart Answer the following questions about the chart for Peanuts and Bats above. (#2-5 worth 2 points each; #6 worth 4 points; 12 points total) 2. Who has the absolute advantage in peanuts? (Hint: Which country produces the most peanuts?) Country Y 3. Who has the absolute advantage in bats? (Hint: Which country produces the most bats?) Country Z 4. Who has the comparative advantage in producing bats? (Hint: Compare and choose the lowest number.) Country Z 5. Who has the comparative advantage in producing peanuts? (Hint: Compare and choose the lowest number.) Country Y

Economics © ACCESS Virtual Learning 2023 6. If the terms of trade are 1 peanut for 9 bats, should the two nations trade? (Hint: Look at the chart you completed. Does 9 bats fall between or beyond the opportunity cost of peanuts for the countries? If between, trade. If beyond, do not trade.) Explain your answer. Write your answer below: They should not trade. 9 bats fall beyond the opportunity cost for peanuts. This would make the trade not beneficial. Part 3: “Other Goes Over” 7. Use the data provided in the Production Possibilities Frontier Graph to complete parts A- D of the table below. 8. Next, use the “Other Goes Over” Method presented to you in the Learn section of the lesson to complete the table parts E-H for Country A and Country B for both cereal and pens. Reduce the fractions so you can compare the output of the nations. (2 points per blank; 16 total points) Cereal Pens Country A a) 80 (from the PPF) b) 40 (from the PPF) e) 1/2 (show the “other goes over” fraction) f) 2 (show the “other goes over” fraction) Country B c) 60 (from the PPF) d) 20 (from the PPF) g) 1/3 (show the “other goes h) 3 (show the “other goes