Principles of Economics (12th Edition)
12th Edition
ISBN: 9780134078779
Author: Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher: PEARSON
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Question
Chapter 2, Problem 1.6P
Subpart (a)
To determine
Which country has
Subpart (b)
To determine
Which country has
Subpart (c)
To determine
Subpart (d)
To determine
Allocation of workers.
Subpart (e)
To determine
Occurrence of trade.
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Hours Needed to Make 1 Unit of
Sweaters
Cakes
Sweden 1
Iceland
5
4
2
8 units of sweaters and 10 units of cakes
24 units of sweaters and 15 units of cakes
Refer to Table 3-3. Assume that Sweden and Iceland each has 40 labor hours available. If each country divides its
time equally between the production of sweaters and cakes, then total production is
40 units of sweaters and 20 units of cakes
Number of Units Produced in 40 Hours
Sweaters
Cakes
48 units of sweaters and 30 units of cakes
40
8
10
20
16
Production Opportunities
Hours Needed to Make 1 Unit of
Number of Units Produced in 40 Hours
Cheese
Wine
Cheese
Wine
England
1
4
40
10
France
5
2
8
20
Refer to Table 3-3. Assume that England and France each has 40 labor hours available. If each country divides its
time equally between the production of cheese and wine, then total production is
8 units of cheese and 10 units of wine
24 units of cheese and 15 units of wine
40 units of cheese and 20 units of wine
b
48 units of cheese and 30 units of wine
Chapter 2 Solutions
Principles of Economics (12th Edition)
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