2. Gains from trade Consider two neighboring island countries called Felicidad and Bellissima. They each have 4 milion labor hours available per month that they can use to produce rye, jeans, or a combination of both. The following table shows the amount of rye or jeans that can be produced using 1 hour of labor. Rye Jeans Country (Bushels per hour of labor) (Pairs per hour of labor) Felicidad 5. 20 Bellissima 8. 16 Initially, suppose Bellissima uses 1 million hours of labor per month to produce rye and 3 million hours per month to produce jeans, while Felicidad uses 3 million hours of labor per month to produce rye and 1 millon hours per month to produce jeans. Consequently, Felicidad produces 15 millon bushels of rye and 20 million pairs of jeans, and Bellissima produces 8 million bushels of rye and 48 million pairs of jeans. Assume there are no other countries willing to trade goods, so, in the absence of trade between these two countries, each country consumes the amount of rye and jeans it produces. v of jeans, and Bellissima's opportunity cost of producing 1 bushel of rye is v has a comparative Felicidad's opportunity cost of producing 1 bushel of rye is v of jeans. Therefore, v has a comparative advantage in the production of rye, and advantage in the production of jeans. Suppose that each country completely specializes In the production of the good in which It has a comparative advantage, producing only that good. In million bushels per month, and the country that produces jeans will produce this case, the country that produces rye will produce million pairs per month. In the following table, enter each country's production decision on the third row of the table (marked "Production"). Suppose the country that produces rye trades 18 million bushels of rye to the other country In exchange for 54 million pairs of jeans. *and In the following table, select the amount of each good that each country exports and Imports in the boxes across the row marked "Trade enter each country's final consumption of each good on the line marked "Consumption." When the two countries did not specialize, the total production of rye was 23 million bushels per month, and the total production of jeans was 68 million bushels per month, and the total million pairs per month. Because of specialization, the total production of rye has increased by production of Jeans has increased by million pairs per month.