Nation 1: China Good 1: Smartphones Nations Given: China and Japan produce only two goods. They have the same fixed resources are equally efficient and both countries have constant opportunity costs between the two goods. in one month China can produce 180,000 smartphones or 40,000 tablets. Japan can produce 120,000 smartphones or 30,000 tablets. Fill in the table below. USA Russia Max Production Nation 2: Japan A) Graph the given information. Good 2: Tablets Opportunity Cost Opportunity Cost
Nation 1: China Good 1: Smartphones Nations Given: China and Japan produce only two goods. They have the same fixed resources are equally efficient and both countries have constant opportunity costs between the two goods. in one month China can produce 180,000 smartphones or 40,000 tablets. Japan can produce 120,000 smartphones or 30,000 tablets. Fill in the table below. USA Russia Max Production Nation 2: Japan A) Graph the given information. Good 2: Tablets Opportunity Cost Opportunity Cost
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question

Transcribed Image Text:B) If the two nations enter a trade agreement, what are the maximum and minimum values
Good 1 would trade for?
C) If the two nations enter a trade agreement, what are the acceptable terms of trade for Good
1?
D) Give a specific example of a certain amount of good 1 trading for good 2. How much did
each nation profit from entering the trade agreement?
ex. France trades 5 apples to Germany for 10 oranges.
If France made 10 oranges, it would cost them 20 apples. They only had to give Germany 5
apples (instead of 20 apples) for 10 oranges, so they profited by 15 apples.
If Germany made 5 apples, it would cost them 17 oranges. They only had to give France 1
oranges, so they profited by 7 oranges.

Transcribed Image Text:Nation 1: China
Good 1: Smartphones
@
Given: China and Japan produce only two goods. They have the same fixed resources are
equally efficient and both countries have constant opportunity costs between the two goods.
in one month China can produce 180,000 smartphones or 40,000 tablets. Japan can
produce 120,000 smartphones or 30,000 tablets. Fill in the table below.
Nations
USA
Russia
Max Production
Nation 2: Japan
A) Graph the given information.
Good 2: Tablets
Opportunity Cost
Opportunity Cost
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Step 1: Define comparative advantage
VIEWStep 2: a. Complete the table and graph the scenario
VIEWStep 3: b. State the maximum value if two countries enters into an agreement
VIEWStep 4: c. State for acceptable terms of trade for Good 1
VIEWStep 5: d. State an example to show the benefit from trade agreement
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