Microeconomics (6th Edition)
Microeconomics (6th Edition)
6th Edition
ISBN: 9780134106243
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
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Chapter 9, Problem 9.2.6PA
To determine

Calculation of opportunity cost.

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The table below describes production possibilities for Mexico and Nigeria. Each number in the table shows the number of workers needed to produce one unit of the product. Country Shoes Glasses Mexico 10 12 Nigeria 18 5   Which country should be specializing in the production of Glasses? Which country should be specializing in the production of Shoes? Which country should be exporting Shoes? Which country should be exporting Glasses?
Two countries (A and B) produce tea and oranges using labor. The number of hours of labor required to produce these goods are given as follows: Country Тea Oranges A 6 20 В 8 30 If both countries have 1500 hours of labor available, explain how they can gain from trade.
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