Country (Bushels per hour of labor) (Pairs per hour of labor) Euphoria 8. 32 Contente 12 24 nitially, suppose Contente uses 1 million hours of labor per week to produce rye and3 million hours per week to produce jeans, while Euphoria uses million hours of labor per week to produce rye and 1 million hours per week to produce jeans. Consequently, Euphoria produces 24 million bushels o ye and 32 million pairs of jeans, and Contente produces 12 million bushels of rye and 72 million pairs of jeans. Assume there are no other countries willing to trade goods, so, in the absence of trade between these two countries, each country consurmes the armount of rye and jeans it produces. Euphoria's opportunity cost of producing 1 bushel of rye is of jeans, and Contente's opportunity cost of producing 1 bushel of rye is of jeans. Therefore, has a comparative advantage in the production of rye, and has a comparative advantage in the production of jeans.

Country (Bushels per hour of labor) (Pairs per hour of labor) Euphoria 8. 32 Contente 12 24 nitially, suppose Contente uses 1 million hours of labor per week to produce rye and3 million hours per week to produce jeans, while Euphoria uses million hours of labor per week to produce rye and 1 million hours per week to produce jeans. Consequently, Euphoria produces 24 million bushels o ye and 32 million pairs of jeans, and Contente produces 12 million bushels of rye and 72 million pairs of jeans. Assume there are no other countries willing to trade goods, so, in the absence of trade between these two countries, each country consurmes the armount of rye and jeans it produces. Euphoria's opportunity cost of producing 1 bushel of rye is of jeans, and Contente's opportunity cost of producing 1 bushel of rye is of jeans. Therefore, has a comparative advantage in the production of rye, and has a comparative advantage in the production of jeans.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter33: International Trade

Section: Chapter Questions

Problem 22CTQ: You just got a job in Washington, D.C. You move into an apartment with some acquaintances. All your...

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