Question 5 [There are 100 workers in Pakistan, and each worker can produce either 10 shirts or 2 hats. There are 200 workers in Bangladesh, and each can produce either 4 shirts or 10 hats.] a. [Draw the Production Possibility Curves (PPC) for each country. What is the opportunity cost of shirts in Pakistan? What is the opportunity cost of shirts in Bangladesh? Which country has a comparative advantage in the production of shirts?] All sub-parts answered correctly b. [In the absence of trade, if Pakistan consumes 600 shirts, how many hats can it consume? In the absence of trade, if Bangladesh consumes 500 hats, how many shirts can it consume?] Both the sub-parts answered correctly. c. [Someone now proposes that Bangladesh and Pakistan enter into a trade agreement. Under this agreement, Bangladesh will give Pakistan 500 hats and Pakistan will give Bangladesh 200 shirts. If Pakistan continues to consume 600 shirts, how many hats will it be able to consume under this proposal? If Bangladesh continues to consume 500 hats, how many shirts will it be able to consume under this proposal? Should Pakistan accept this proposal? Should Bangladesh accept this proposal?] All sub-parts answered correctly
Question 5 [There are 100 workers in Pakistan, and each worker can produce either 10 shirts or 2 hats. There are 200 workers in Bangladesh, and each can produce either 4 shirts or 10 hats.] a. [Draw the Production Possibility Curves (PPC) for each country. What is the opportunity cost of shirts in Pakistan? What is the opportunity cost of shirts in Bangladesh? Which country has a comparative advantage in the production of shirts?] All sub-parts answered correctly b. [In the absence of trade, if Pakistan consumes 600 shirts, how many hats can it consume? In the absence of trade, if Bangladesh consumes 500 hats, how many shirts can it consume?] Both the sub-parts answered correctly. c. [Someone now proposes that Bangladesh and Pakistan enter into a trade agreement. Under this agreement, Bangladesh will give Pakistan 500 hats and Pakistan will give Bangladesh 200 shirts. If Pakistan continues to consume 600 shirts, how many hats will it be able to consume under this proposal? If Bangladesh continues to consume 500 hats, how many shirts will it be able to consume under this proposal? Should Pakistan accept this proposal? Should Bangladesh accept this proposal?] All sub-parts answered correctly
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
![Question 5
[There are 100 workers in Pakistan, and each worker can produce either 10 shirts or
2 hats. There are 200 workers in Bangladesh, and each can produce either 4 shirts
or 10 hats.]
a. [Draw the Production Possibility Curves (PPC) for each country. What is the
opportunity cost of shirts in Pakistan? What is the opportunity cost of shirts in
Bangladesh? Which country has a comparative advantage in the production
of shirts?] All sub-parts answered correctly
b. [In the absence of trade, if Pakistan consumes 600 shirts, how many hats can
it consume? In the absence of trade, if Bangladesh consumes 500 hats, how
many shirts can it consume?] Both the sub-parts answered correctly.
c. [Someone now proposes that Bangladesh and Pakistan enter into a trade
agreement. Under this agreement, Bangladesh will give Pakistan 500 hats
and Pakistan will give Bangladesh 200 shirts. If Pakistan continues to
consume 600 shirts, how many hats will it be able to consume under this
proposal? If Bangladesh continues to consume 500 hats, how many shirts will
it be able to consume under this proposal? Should Pakistan accept this
proposal? Should Bangladesh accept this proposal?] All sub-parts answered
correctly.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1142add5-91c5-4a27-aa8c-f5851236ec6a%2F732cfaa3-9df9-457e-a66b-d973e546da82%2F4s5d9ub_processed.png&w=3840&q=75)
Transcribed Image Text:Question 5
[There are 100 workers in Pakistan, and each worker can produce either 10 shirts or
2 hats. There are 200 workers in Bangladesh, and each can produce either 4 shirts
or 10 hats.]
a. [Draw the Production Possibility Curves (PPC) for each country. What is the
opportunity cost of shirts in Pakistan? What is the opportunity cost of shirts in
Bangladesh? Which country has a comparative advantage in the production
of shirts?] All sub-parts answered correctly
b. [In the absence of trade, if Pakistan consumes 600 shirts, how many hats can
it consume? In the absence of trade, if Bangladesh consumes 500 hats, how
many shirts can it consume?] Both the sub-parts answered correctly.
c. [Someone now proposes that Bangladesh and Pakistan enter into a trade
agreement. Under this agreement, Bangladesh will give Pakistan 500 hats
and Pakistan will give Bangladesh 200 shirts. If Pakistan continues to
consume 600 shirts, how many hats will it be able to consume under this
proposal? If Bangladesh continues to consume 500 hats, how many shirts will
it be able to consume under this proposal? Should Pakistan accept this
proposal? Should Bangladesh accept this proposal?] All sub-parts answered
correctly.
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