"he following table summarizes the combinations of goods X and Y that two individuals, Nicki and Kamal, can each produce individually. Nicki Kаmal Y X Y 300 250 150 30 | 125 62.5 60 125 f each person specializes in the production of the good for which they have the comparative advantage, then would specialize in the production of good Y, and would specialize in the production of good X. (Hint: Calculate the opportunity cost of producing X and Y for each individual.) Suppose that Kamal and Nicki each specializes in the production of the good in which each has a comparative advantage.
"he following table summarizes the combinations of goods X and Y that two individuals, Nicki and Kamal, can each produce individually. Nicki Kаmal Y X Y 300 250 150 30 | 125 62.5 60 125 f each person specializes in the production of the good for which they have the comparative advantage, then would specialize in the production of good Y, and would specialize in the production of good X. (Hint: Calculate the opportunity cost of producing X and Y for each individual.) Suppose that Kamal and Nicki each specializes in the production of the good in which each has a comparative advantage.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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After specialization, suppose the two agree on a price of 7 units of good X for each unit of good Y. When the two individuals make the trade, they exchange 140 units of good X for 20 units of good Y. Recall that the individual who has specialized in the production of X would trade 140 units of good X and receive 20 units of good Y, while the individual who specialized in the production of good Y would trade 20 units of good Y and receive 140 units of good X.
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