Juppost uic counuy thút producca jcuns uduca 14 m on pal3 Ul jeans Lo die ouiiel Country in exchange for 42 hmilllon busnels of comn.In the following table, select the amount of each good that each country exports and Imports in the boxes across the row marked "Trade Action, " andenter each country's final consumption of each good on the line marked "Consumption."When the two countries did not specialize, the total production of jeans was 18 million pairs per week, and the total production of corn was 52 millionbushels per week. Because of specialization, the total production of jeans has increased bymillion pairs per week, and the total production ofcorn has increased bymillion bushels per week.Because the two countries produce more jeans and more corn 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 thetable. In the following table, enter this difference in the boxes across the last row (marked "Increase in Consumption").FelicidadBellissimaJeansCornJeansCorn(Millions of pairs)(Millions of bushels)(Millions of pairs)(Millions of bushels)Without TradeProduction1216636Consumption121636With TradeProductionTrade actionConsumptionGains from TradeIncrease in ConsumptionMacBook Air 3. Gains from tradeConsider two neighboring island countries called Felicidad and Bellissima. They each have 4 million labor hours available per week that they can use toproduce jeans, corn, or a combination of both. The following table shows the amount of jeans or corn that can be produced using 1 hour of labor.JeansCornCountry(Pairs per hour of labor)(Bushels per hour of labor)Felicidad416Bellissima612

3. Gains from trade Consider two neighboring island countries called Felicidad and Bellissima. They each have 4 million labor hours available per week that they can use to produce jeans, corn, or a combination of both. The following table shows the amount of jeans or corn that can be produced using 1 hour of labor. Jeans Corn Country (Pairs per hour of labor) (Bushels per hour of labor) Felicidad 4 16 Bellissima 6 12

3. Gains from trade Consider two neighboring island countries called Felicidad and Bellissima. They each have 4 million labor hours available per week that they can use to produce jeans, corn, or a combination of both. The following table shows the amount of jeans or corn that can be produced using 1 hour of labor. Jeans Corn Country (Pairs per hour of labor) (Bushels per hour of labor) Felicidad 4 16 Bellissima 6 12

Principles of Microeconomics (MindTap Course List)

8th Edition

ISBN:9781305971493

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter9: Application: International Trade

Section: Chapter Questions

Problem 8PA

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