The above tables represent the production possibilities frontiers (PPFs) for two different countries (Country 1 and Country 2) for two different goods (Good X and Good Y.) Points A, B, C, D, E, F represent various points along the PPF for Country 1. Points L, M, N, O, P represent various points along the PPF for Country 2.Assume that in each country the total number of hours worked is the same.Assume that before specialization Country 1 produces at point B and Country 2 produces at point M.Assume that each country completely specializes in the good in which it has comparative advantage.The overall gain in production that would occur from each country specializing in the good where it has comparative advantage is __________ units of Good X and __________ units of Good Y. Country 1ProductionA BCD EFPointGood X500 400 300 200 100Good Y300 600 900 1200 1500Country 2Production PointMGood X12,000 9000 6000 3000 0Good Y500 1000 1500 2000The above tables represent the production possibilities frontiers (PPFS) for twodifferent countries (Country 1 and Country 2) for two different goods (Good X andGood Y.) Points A, B, C, D, E, F represent various points along the PPF for Country 1.Points L, M, N, O, P represent various points along the PPF for Country 2.Assume that in each country the total number of hours worked is the same.Assume that before specialization Country 1 produces at point B and Country 2produces at point M.Assume that each country completely specializes in the good in which it hascomparative advantage.The overall gain in production that would occur from each country specializing in thegood where it has comparative advantage is100units of Good X and100units of Good Y.

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Answered: The above tables represent the…

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

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The above tables represent the production possibilities frontiers (PPFs) for two different countries (Country 1 and Country 2) for two different goods (Good X and Good Y.) Points A, B, C, D, E, F represent various points along the PPF for Country 1. Points L, M, N, O, P represent various points along the PPF for Country 2.

Assume that in each country the total number of hours worked is the same.

Assume that before specialization Country 1 produces at point B and Country 2 produces at point M.

Assume that each country completely specializes in the good in which it has comparative advantage.

The overall gain in production that would occur from each country specializing in the good where it has comparative advantage is __________ units of Good X and __________ units of Good Y.

Country 1
Production
A BCD E
F
Point
Good X
500 400 300 200 100
Good Y
300 600 900 1200 1500
Country 2
Production Point
M
Good X
12,000 9000 6000 3000 0
Good Y
500 1000 1500 2000
The above tables represent the production possibilities frontiers (PPFS) for two
different countries (Country 1 and Country 2) for two different goods (Good X and
Good Y.) Points A, B, C, D, E, F represent various points along the PPF for Country 1.
Points L, M, N, O, P represent various points along the PPF for Country 2.
Assume that in each country the total number of hours worked is the same.
Assume that before specialization Country 1 produces at point B and Country 2
produces at point M.
Assume that each country completely specializes in the good in which it has
comparative advantage.
The overall gain in production that would occur from each country specializing in the
good where it has comparative advantage is
100
units of Good X and
100
units of Good Y.

Definition Video Definition Ability of a country to produce goods and services at a lower opportunity cost compared to other countries. Here, opportunity cost refers to the forgone units of one good in order to produce one more unit of another good. For example, the opportunity cost of producing good X in country A is 2Y and in country B is 1.25Y. Country B has a lower opportunity cost of producing good X than country A. Therefore, country B has a comparative advantage in the production of good X. Video

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