Suppose that without trade the workers in each country spend half their time producing each good. Use the black point (plus symbol) to indicate this production and consumption point for the United States, and use the grey point (star symbol) to indicate this production and consumption point for China. If these countries were open to trade, The price of a computer can be expressed in terms of shirts. The highest price for which a computer can be traded that would make both countries better off is ✓shirts per computer, and the lowest price that makes both countries better off is shirts per computer. True or False: There are no longer gains from trade. would export shirts and Suppose that China catches up with American productivity so that a Chinese worker can produce 60 shirts or 30 computers. True would benefit from trade. O False

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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Suppose that without trade the workers in each country spend half their time producing each good.
Use the black point (plus symbol) to indicate this production and consumption point for the United States, and use the grey point (star symbol) to
indicate this production and consumption point for China.
If these countries were open to trade,
The price of a computer can be expressed in terms of shirts. The highest price for which a computer can be traded that would make both countries
shirts per computer, and the lowest price that makes both countries better off is
shirts per computer.
better off is
True or False: There are no longer gains from trade.
Suppose that China catches up with American productivity so that a Chinese worker can produce 60 shirts or 30 computers.
#
O True
would export shirts and
O False
Search the web and Windows
Ô
would benefit from trade.
e
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Transcribed Image Text:Suppose that without trade the workers in each country spend half their time producing each good. Use the black point (plus symbol) to indicate this production and consumption point for the United States, and use the grey point (star symbol) to indicate this production and consumption point for China. If these countries were open to trade, The price of a computer can be expressed in terms of shirts. The highest price for which a computer can be traded that would make both countries shirts per computer, and the lowest price that makes both countries better off is shirts per computer. better off is True or False: There are no longer gains from trade. Suppose that China catches up with American productivity so that a Chinese worker can produce 60 shirts or 30 computers. # O True would export shirts and O False Search the web and Windows Ô would benefit from trade. e Grade It Now Save & Continue Continue without saving M
8. Problems and Applications Q8
Suppose that in a year an American worker can produce 60 shirts or 30 computers and a Chinese worker can produce 60 shirts or 12 computers.
There are 1 million workers in each country.
Use the blue line (circle symbol) to graph the production possibilities frontier (PPF) for the United States, and use the green line (triangle symbol) to
graph the production possibilities frontier for China.
Quantity of Computers (Millions)
30
27
24
21
18
15
12
9
6
3
0
0 10 20
30
40 50 60 70 80 90 100
Quantity of Shirts (Millions)
U.S. PPF
China PPF
US without Trade
✪
China without Trade
Suppose that without trade the workers in each country spend half their time producing each good.
Transcribed Image Text:8. Problems and Applications Q8 Suppose that in a year an American worker can produce 60 shirts or 30 computers and a Chinese worker can produce 60 shirts or 12 computers. There are 1 million workers in each country. Use the blue line (circle symbol) to graph the production possibilities frontier (PPF) for the United States, and use the green line (triangle symbol) to graph the production possibilities frontier for China. Quantity of Computers (Millions) 30 27 24 21 18 15 12 9 6 3 0 0 10 20 30 40 50 60 70 80 90 100 Quantity of Shirts (Millions) U.S. PPF China PPF US without Trade ✪ China without Trade Suppose that without trade the workers in each country spend half their time producing each good.
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