When the two countries did not specialize, the total production of pistachios was 36 million pounds per day, and the total production of chinos was 104 million pairs per day. Because of specialization, the total production of pistachios has increased by 9 million pounds per day, and the total production of chinos has increased by 12 million pairs per day. Because the two countries produce more pistachios and more chinos under specialization, each country is able to gain from trade. Calculate the gains from trade-that is, the amount by which each country has increased its consumption of each good relative to the first row of the table. In the following table, enter this difference in the boxes across the last row (marked "Increase in Consumption"). Glacier Everglades Pistachios (Millions of pounds) Chinos Pistachios Chinos (Millions of pairs) (Millions of pounds) (Millions of pairs) S Without Trade Production Consumption With Trade Production Trade action Consumption Gains from Trade Increase in Consumption 12 72 24 32 12 72 24 32 Grade It Now Save & Continue

When the two countries did not specialize, the total production of pistachios was 36 million pounds per day, and the total production of chinos was 104 million pairs per day. Because of specialization, the total production of pistachios has increased by 9 million pounds per day, and the total production of chinos has increased by 12 million pairs per day. Because the two countries produce more pistachios and more chinos under specialization, each country is able to gain from trade. Calculate the gains from trade-that is, the amount by which each country has increased its consumption of each good relative to the first row of the table. In the following table, enter this difference in the boxes across the last row (marked "Increase in Consumption"). Glacier Everglades Pistachios (Millions of pounds) Chinos Pistachios Chinos (Millions of pairs) (Millions of pounds) (Millions of pairs) S Without Trade Production Consumption With Trade Production Trade action Consumption Gains from Trade Increase in Consumption 12 72 24 32 12 72 24 32 Grade It Now Save & Continue

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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