Assume that England and Spain can switch between producing cheese and producing bread at a constant rate. Labor Hours Needed to Make 1 Unit of Number of Units Produced in 24 Hours Cheese Bread Cheese Bread England 2 3 12 8 Spain 3 6 8 4 Refer to Table 3-5. Which of the following combinations of cheese and bread could Spain produce in 24 hours? 4 units of cheese and 3 units of bread O 6 units of cheese and 1 units of bread O 7 units of cheese and 1.5 units of bread

Assume that England and Spain can switch between producing cheese and producing bread at a constant rate. Labor Hours Needed to Make 1 Unit of Number of Units Produced in 24 Hours Cheese Bread Cheese Bread England 2 3 12 8 Spain 3 6 8 4 Refer to Table 3-5. Which of the following combinations of cheese and bread could Spain produce in 24 hours? 4 units of cheese and 3 units of bread O 6 units of cheese and 1 units of bread O 7 units of cheese and 1.5 units of bread

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter3: Interdependence And The Gains Rrom Trade

Section: Chapter Questions

Problem 3PA

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Review the numbers for Canada and Venezuela from Table 33.12 which describes how many barrels of oil and tons of lumber the workers can produce. Use these numbers to answer the rest of this question. Draw a production possibilities frontier for each country. Assume there are 100 workers in each country. Canadians and Venezuelans desire both oil and lumber. Canadians want at least 2,000 tons of lumber. Mark a point on their production possibilities where they can get at least 3,000 tons. Assume that the Canadians specialize completely because they figured out they have a comparative advantage in lumber. They are willing to give up 1,000 tons of lumber. How much oil should they ask for in return for this lumber to be as well off as they were with no trade? How much should they ask for if they want to gain from trading with Venezuela? Note: We can think of this ask as the relative price or trade price of lumber. Is the Canadian ask you identified in (b) also beneficial for Venezuelans? Use the production possibilities frontier graph for Venezuela to show that Venezuelans can gain from trade.
France and Tunisia both have Mediterranean climates that are excellent for producing/harvesting green beans and tomatoes. In France it takes two hours for each worker to harvest green beans and two hours to harvest a tomato. Tunisian workers need only one hour to harvest the tomatoes but four hours to harvest green beans. Assume there are only two workers, one in each country, and each works 40 hours a week. Draw a production possibilities frontier for each country. Hint: Remember the production possibility frontier is the maximum that all workers can produce at a unit of time which, in this problem, is a week. Identify which country has the absolute advantage in green beans and which country has the absolute advantage in tomatoes. Identity which country has the comparative advantage. How much would France have to give up In terms of tomatoes to gain from trade? How much would it have to give up in terms of green beans?
France and Tunisia both have Mediterraneanclimates that are excellent for producing/harvestinggreen beans and tomatoes. In France it takes two hoursfor each worker to harvest green beans and two hours toharvest a tomato. Tunisian workers need only one hourto harvest the tomatoes but four hours to harvest greenbeans. Assume there are only two workers, one in eachcountry, and each works 40 hours a week.a. Draw a production possibilities frontier for eachcountry. Hint: Remember the productionpossibility frontier is the maximum that allworkers can produce at a unit of time which, inthis problem, is a week.b. Identify which country has the absoluteadvantage in green beans and which country hasthe absolute advantage in tomatoes.c. Identify which country has the comparativeadvantage.d. How much would France have to give up interms of tomatoes to gain from trade? How muchwould it have to give up in terms of green beans?
Robinson can catch 1 fish or gather 2 coconuts. in an hour, Bill can catch 1 fish or gather 1coconut. In an hour, Chris can catch 8 fish or gather 2coconuts a. If production is organized according to comparative advantage, in what order will the three inhabitants collect coconuts? (That is, if only one of the three collects coconuts, who will it be? And if two of them collect coconuts, which two will it be?) b. Draw the production possibilities curve (PPC) when there is no specialization—that is, when each worker divides their time between fish and coconuts in the same way as the other two workers. Identify and explain the vertical intercept, the slope, and the horizontal intercept of the PPC in this case.
11. If Portugal has a total of 180 man-hours of resources available for production, while England has only 120, what are the resource costs of wine and cloth? a) wine costs 2 man-hours/bottle and cloth 6 man-hours/yard in Portugal. b) wine costs 1 man-hour/bottle and cloth is 1 man-hour/yard in England. c) cloth costs 4 man-hours/yard and wine 2 man-hours/bottle in Portugal. d) wine costs 1/2 yards/bottle and cloth 2 bottles/yard in Portugal.
A nation with fixed quantities of resources is able to produce any of the following combinations of bread and ovens:Bread (tons) Oven (000’s)60 050 1240 2230 3020 3610 40 0 42These figures assume that a certain number of previously produced ovens are available in the current period for baking bread.a. Using data in the table, graph the ppf (with ovens on the vertical axis)b. What happens to the opportunity cost of bread – measured in number of ovens—as bread production increases from 0 to 10 tons, from 10 to 20 tons, from 20 to 30 tons, and so on?c. If this country chooses to produce both bread and ovens, what will happen to the ppf over time? Why? Select one:a. Remains stagnant b. Decline over time towards inefficiencyc. Increase over time and declined. Increase over time towards growth
The Marope Economy has the capacity to produce the goods and services that are outlined in Table 1 below. You are required to:a. Draw a Production Possibility Frontier (PPF) and list all efficient points of production.b. Marope Economy wishes to produce 520 billion units of consumer goods. Plot this output onthe Frontier and state whether this is an efficient point or not.Table 1 – Production Possibilities Output (billions of units per year) Consumer goods Consumer servicesPart BA B480 420 0 120C D240 0 240 300 Use graphs to demonstrate how the following factors will change the PPF.a. A decrease in migrationb. An increase in natural resourcesc. Changes in technology
ackground information: A worker in the United States and a worker in China can each produce 1,000 pairs of jeans per week. A worker in the United States can produce 50 cell phones in a week, and a worker in China can produce 100 cell phones in a week. Answer the following questions based on this information.Part A: If each country attempted to produce both jeans and cell phones, how many jeans and cell phones could each country produce? What would be the total number of jeans and cell phones produced by the two countries combined? (Show your work.)Part B: Calculate the opportunity cost of producing jeans for each country. (Show your work.)Part C: Calculate the opportunity cost of producing cell phones for each country. (Show your work.)Part D: Determine how many jeans should be produced by each nation. (Show your work). Part E: If each nation should specialize in producing jeans and cell phones, explain why; use economic terminology you have learned in this unit in your…
Q3) Illustrate the Production Possibility Frontier by graph from the table below and explain what will happen to the following changes: If the community decided to move from point C to D If they decided to move from E to D. If they want to produce 400 units from consumer goods and 400 units from capital goods. If they want to produce 500 units from consumer goods and 150 units from capital goods. Table shows the production possibility for total barely and lentils in Oman Point on PPT Consumer goods per year Capital goods per year A 600 150 B 500 250 C 400 350 D 300 400 E 200 500
scenario Production Advantage and Opportunity CostsAssume there are two countries, the United States and France, and two goods, automobiles andcomputers.The table presented below shows the number of automobiles and computers that the United States andFrance can produce with the same amount of resources.United States FranceAutomobiles 120 100Computers 60 55Source: Pearson Education Inc. 1.1 Which country has an absolute advantage in computer production? Motivate your answer.1.2 Which country has a comparative advantage in the production of automobiles? Motivateyour answer. 1.3 Assume these countries trade with one another under the conditions of free trade. Whichcountry will specialise in the production of automobiles? Motivate your answer. 1.4 If free trade exists between the United States and France, what are the highest and lowestlevels for the price of an automobile (expressed in terms of computers)? Motivate youranswer by stating which level favours the United States and France.
Production Advantage and Opportunity CostsAssume there are two countries, the United States and France, and two goods, automobiles andcomputers.The table presented below shows the number of automobiles and computers that the United States andFrance can produce with the same amount of resources.United States FranceAutomobiles 120 100Computers 60 55Source: Pearson Education Inc. 1.1 Which country has an absolute advantage in computer production? Motivate your answer.1.2 Which country has a comparative advantage in the production of automobiles? Motivateyour answer. 1.3 Assume these countries trade with one another under the conditions of free trade. Whichcountry will specialise in the production of automobiles? Motivate your answer. 1.4 If free trade exists between the United States and France, what are the highest and lowestlevels for the price of an automobile (expressed in terms of computers)? Motivate youranswer by stating which level favours the United States and France.
Assume that Andy and Henry, without trading with each other, will produce and consume the following number of steel bars and ketchup bottles. The Gains from Trade Without trade Person Good Production Consumption Gains from Trade Andy Steel bars 60 60 +35 Btl. Ketchup 60 60 +15 Henry Steel bars 20 20 +5 Btl. Ketchup 20 20 +5 Now, Assume that both Andy and Henry decide to specialize, and then Andy trades 25 steel bars to Henry for 75 Btls. ketchup. This outcome is shown in the table below. Compared to the result without trade, what are the gains from trade that Andy experiences when he and Henry specialize and trade? The Gains from Trade With specialization Person Good Production Consumption Gains from Trade Andy Steel bars 120 95 (keep) +35 Btl. ketchup 0 75 (from Henry) +15 Henry Steel bars 0 25 (from Andy) +5 Btl. ketchup 100 25 (keep) +5