Given the above set of production possibilities and consumption (trade) possibilities frontiers, what happens to the prices of wine and cloth in each country as a result of trade?     a) The price of wine in Portugal decreases from ⅓ yard/bottle to ½ yard/bottle.     b) The price of cloth in Portugal increases from 3 bottles/yard to 2 bottles/yard.     c) The price of wine in England decreases from 1 yard/bottle to ½ yard/bottle.     d) The price of cloth in England increases from 1 bottle/yard to 3 bottles/yard.     e) All of the above

Q: Country A can produce either 200 personal computers or 800 tons of potatoes with the same amount of…

A: (1). Country B has the absolute advantage in producing personal computers because it produces 300…

Q: Suppose that France and Germany both produce wine and schnitzel. The table below shows combinations…

A: A market is a place where the buyers and the sellers interacts with each other and the exchange of…

Q: 3. Gains from trade Suppose there exist two imaginary countries, Yosemite and Sequoia. Their labor…

A: Opportunity cost is the cost of producing 1 good in terms of other. Opportunity cost shows the…

Q: 10) PPFS for Countries X and Y 300 Y 200 400 tons of rice a). In the graph above, what is the…

A: Comparative advantage, when country can produce a good with least opportunity cost than than others.

Q: Assume that Germany has 1200 units of labor available and it can produce two goods: apples and…

A: Comparative advantage refers to the phenomenon where the country can produce the good with the…

Q: wine SERE54321 90 80 70 60 50 40 30 20 10 PPF Portugal CPF 0 0 10 20 30 40 50 60 cloth wine 90…

A: PPF stands for Production Possibility Frontier, which is a graphical representation showing the…

Q: Which of the following is true about trade? The basis for trade is absolute advantage Trade results…

A: International trade refers to the exchange of capital, products, and services across international…

Q: The U.S. is one of the main producers of oil in the world. Still, at the current world price, there…

A: Tariff is a tax imposed on trade, on the goods which are imported or exported. Generally, tariffs…

Q: Assume that under free trade the U.S. can import good x from France for $50 and domestic consumption…

A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

Q: Suppose that the world price of bananas is 18 U.S. cents a pound and that when Australia does not…

A: Introduction International trade is indeed the transfer of capital, commodities, and services…

Q: 27. The statement that "if an import tariff raises the relative price of the imported good, the…

A: Given statement describes the relationship between relative prices of output and relative factor…

Q: Assume that the United States, as a steel-importing nation, is large enough so that changes in the…

A: A free trade agreement, or FTA, is a policy that allows two or more nations to exchange products and…

Q: 8. Assume that now trade happens. The relative supply of wine in the home country is less than the…

A: It is given that the domestic supply of wine is less in home country than the world due to which…

Q: 31.If it takes one country one unit of labor to produce either a computer or a TV but it takes the…

A: “Since you have posted multiple questions, we will provide the solution only to the first question…

Q: 5. Welfare effects of a tariff in a small country Suppose Kenya is open to free trade in the world…

A: Trade is an activity where the exchange of goods and services takes place between the seller and the…

Q: Suppose the international relative price of gold is 10 bushels of wheat/bar of gold. If South Africa…

A: Given in the question productivity in two countries : Opportunity cost of wheat in South Africa =…

Q: 26. What are the implied relative price of wine in international trade?     a) 1/3 yard/bottle…

A: We are going to understand the opportunity cost and relative price to solve this problem.

Q: In Poland, one hour of labour can produce 2 tons of coal or 4 bushels of oats. In England, one hour…

A: If two nations, An and B, are thought of, where the makers of A can create awareness with a chance…

Q: Suppose that France and Germany both produce wine and cheese. The table below shows combinations of…

A: As per given information, Production level   Wine Cheese Germany 5 25 France 4 16…

Q: 1. Suppose there are two countries Peru and Japan that produce Food and Fuel. Peru can produce 7,523…

A: Absolute advantage: If a country has a lower cost of producing a commodity compared to some other…

Q: 11. If Portugal has a total of 120 man-hours of resources available for production, while England…

A: Answer: Correct option: (b) Portugal Explanation: The country which has the least opportunity cost…

Q: Given this set of production possibilities and consumption (trade) possibilities frontiers, what…

A: Production possibility frontier: This represents different production possibilities of two…

Q: Suppose Kenya is open to free trade in the world market for wheat. Because of Kenya's small size,…

A: Consumer surplus (CS) = Area between demand curve and world price  Producer surplus (PS) = Area…

Q: ndia is the world’s largest consumer of sugar. Assume the world price for sugar is $750 per ton.]…

A: The world price refers to the price of a good or commodity in the international market. It is…

Q: Without trade, what is the relative price of wheat in terms of cloth in Pakistan? What is the price…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: New Zealand in one year can raise 75 tons of beef or produce 750 boxes of tulips. In the same…

A: Answer: Given,   Beef (tons) Tulips (boxes) New Zealand 75 750 Belgium 40 650 Let us first…

Q: Suppose that France and Germany both produce wine and cheese. The table below shows combinations of…

A: A notion in international trade is comparative advantage. It emphasizes the advantages of trade…