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Home country has 1200 units of labor available while Foreign country has 800 units of labor. In Home the unit labor requirement in apple production is 3 while in banana production is 2. Foreign unit labor requirement in apple production is 5, while in banana production it is 1. a.) What is the opportunity cost of apples in terms of bananas of Home and Foreign.? b.) In the absence of trade, what would be the price of apples in terms of bananas? c) After opening trade what product is exported and imported by Home and Foreign.? d) Between what ratios would be a possible ratio for international trade (terms of trade

Home country has 1200 units of labor available while Foreign country has 800 units of labor. In Home the unit labor requirement in apple production is 3 while in banana production is 2. Foreign unit labor requirement in apple production is 5, while in banana production it is 1. a.) What is the opportunity cost of apples in terms of bananas of Home and Foreign.? b.) In the absence of trade, what would be the price of apples in terms of bananas? c) After opening trade what product is exported and imported by Home and Foreign.? d) Between what ratios would be a possible ratio for international trade (terms of trade

Essentials of Economics (MindTap Course List)
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter3: Interdependence And The Gains From Trade
Section: Chapter Questions
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Home country has 1200 units of labor available while Foreign country has 800 units of labor. In Home the unit labor requirement in apple production is 3 while in banana production is 2. Foreign unit labor requirement in apple production is 5, while in banana production it is 1. a.) What is the opportunity cost of apples in terms of bananas of Home and Foreign.? b.) In the absence of trade, what would be the price of apples in terms of bananas? c) After opening trade what product is exported and imported by Home and Foreign.? d) Between what ratios would be a possible ratio for international trade (terms of trade)

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