Use the information in the table below to answer the following questions. Production per unit of labor: US Argentina wheat 300 20 beef 100 20 (a) Does either country have an absolute advantage in the production of wheat or beef? Explain. (b) What is the opportunity cost of wheat in each country? (c) What is the opportunity cost of beef in each country?

Use the information in the table below to answer the following questions. Production per unit of labor: US Argentina wheat 300 20 beef 100 20 (a) Does either country have an absolute advantage in the production of wheat or beef? Explain. (b) What is the opportunity cost of wheat in each country? (c) What is the opportunity cost of beef in each country?

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter19: International Trade

Section: Chapter Questions

Problem 12PAE

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Question

Use the information in the table below to answer the following questions. Production per unit of labor:

US Argentina

wheat 300 20

beef 100 20

(a) Does either country have an absolute advantage in the production of wheat or beef? Explain.

(b) What is the opportunity cost of wheat in each country?

(d) Analyze comparative advantage and opportunities for trade between the U.S. and Argentina.

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Exercise: production per unit of labour: US: Wheat 300, Beef 100 Argentina: Wheat 20, Beef 20 a. Does either country have an absolute advantage in the production of wheat or beef? Explain b. What is the opportunity cost of wheat in each country? c. What is the opportunity cost of beef in each country? d. Analyze comparative advantage and opportunities for trade between the U.S. and Argentina.
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Points on Production Possibilities Frontier Canada China Wheat Computers Wheat Computers A 150 0 90 0 B 100 25 60 60 C 50 50 30 120 D 0 75 0 180 Draw the production possibilities graph for Canada and China and label all of the points on the graph. For which good does Canada have a comparative advantage? For which good does China have a comparative advantage? If Canada and China decide to specialize and trade, how many more computers and bushels of wheat would be available for consumption by both countries? Show the increase on your graphs. Canada and China decide to impose trade restrictions in the form of a tariff on the computers and wheat. What are the costs or benefits to the consumer, producer and government for each country?