Homework (Ch 03)Attempts:Keep the Highest: 3/42. Gains from tradeConsider two neighboring island countries called Contente and Felicidad. They each have 4 million labor hours available per week that they can use toproduce rye, jeans, or a combination of both. The following table shows the amount of rye or jeans that can be produced using 1 hour of labor.RyeJeansCountry(Bushels per hour of labor)(Pairs per hour of labor)Contente6.12Felicidad16Initially, suppose Contente uses 1 million hours of labor per week to produce rye and 3 million hours per week to produce jeans, while Felicidad uses 3million hours of labor per week to produce rye and 1 million hours per week to produce jeans. Consequently, Contente produces 6 million bushels ofIsrye and 36 million pairs of jeans, and Felicidad produces 12 million bushels of rye and 16 million pairs of jeans. Assume there are no other countrieswilling to trade goods, so, in the absence of trade between these two countries, each country consumes the amount of rye and jeans it produces.Contente's opportunity cost of producing 1 bushel of rye is 2 pairsof jeans, and Felicidad's opportunity cost of producing 1 bushel of rye is4 pairsof jeans. Therefore, Contentehas a comparative advantage in the production of rye, and Felicidad ▼ has a comparativeadvantage in the production of jeans.Suppose that each country completely specializes in the production of the good in which it has a comparative advantage, producing only that good. Inthis case, the country that produces rye will produce24 million bushels per week, and the country that produces jeans will produce64 million pairs per week.1,706JAN31 Mind Tap Cengage Learninghow old is patrick mahomes - Google SearchCENGAGE MINDTAPQ Search this courseHomework (Ch 03)In the following table, enter each country's production decision on the third row of the table (marked "Production").Suppose the country that produces rye trades 14 million bushels of rye to the other country in exchange for 42 million pairs of jeans.ITEDIn 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."atalogOffersWhen the two countries did not specialize, the total production of rye was 18 million bushels per week, and the total production of jeans was 52 millionpairs per week. Because of specialization, the total production of rye has increased by7 million bushels per week, and the total production ofionsjeans has increased by12 million pairs per week.uccessBecause the two countries produce more rye and more jeans under specialization, each country is able to gain from trade.enterFOR YOUCalculate 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").yToolsContenteFelicidadRyeJeansRyeJeans(Millions of bushels)(Millions of pairs)(Millions of bushels)(Millions of pairs)Without TradeProduction361216Consumption6.361216dbackWith TradeProductionTrade action1,706JAN2PAGES313D6.

Question
Asked Jan 31, 2020
55 views
Homework (Ch 03)
Attempts:
Keep the Highest: 3/4
2. Gains from trade
Consider two neighboring island countries called Contente and Felicidad. They each have 4 million labor hours available per week that they can use to
produce rye, jeans, or a combination of both. The following table shows the amount of rye or jeans that can be produced using 1 hour of labor.
Rye
Jeans
Country
(Bushels per hour of labor)
(Pairs per hour of labor)
Contente
6.
12
Felicidad
16
Initially, suppose Contente uses 1 million hours of labor per week to produce rye and 3 million hours per week to produce jeans, while Felicidad uses 3
million hours of labor per week to produce rye and 1 million hours per week to produce jeans. Consequently, Contente produces 6 million bushels of
Is
rye and 36 million pairs of jeans, and Felicidad produces 12 million bushels of rye and 16 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 consumes the amount of rye and jeans it produces.
Contente's opportunity cost of producing 1 bushel of rye is 2 pairs
of jeans, and Felicidad's opportunity cost of producing 1 bushel of rye is
4 pairs
of jeans. Therefore, Contente
has a comparative advantage in the production of rye, and Felicidad ▼ has a comparative
advantage in the production of jeans.
Suppose that each country completely specializes in the production of the good in which it has a comparative advantage, producing only that good. In
this case, the country that produces rye will produce
24 million bushels per week, and the country that produces jeans will produce
64 million pairs per week.
1,706
JAN
31
help_outline

Image Transcriptionclose

Homework (Ch 03) Attempts: Keep the Highest: 3/4 2. Gains from trade Consider two neighboring island countries called Contente and Felicidad. They each have 4 million labor hours available per week that they can use to produce rye, jeans, or a combination of both. The following table shows the amount of rye or jeans that can be produced using 1 hour of labor. Rye Jeans Country (Bushels per hour of labor) (Pairs per hour of labor) Contente 6. 12 Felicidad 16 Initially, suppose Contente uses 1 million hours of labor per week to produce rye and 3 million hours per week to produce jeans, while Felicidad uses 3 million hours of labor per week to produce rye and 1 million hours per week to produce jeans. Consequently, Contente produces 6 million bushels of Is rye and 36 million pairs of jeans, and Felicidad produces 12 million bushels of rye and 16 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 consumes the amount of rye and jeans it produces. Contente's opportunity cost of producing 1 bushel of rye is 2 pairs of jeans, and Felicidad's opportunity cost of producing 1 bushel of rye is 4 pairs of jeans. Therefore, Contente has a comparative advantage in the production of rye, and Felicidad ▼ has a comparative advantage in the production of jeans. Suppose that each country completely specializes in the production of the good in which it has a comparative advantage, producing only that good. In this case, the country that produces rye will produce 24 million bushels per week, and the country that produces jeans will produce 64 million pairs per week. 1,706 JAN 31

fullscreen
Mind Tap Cengage Learning
how old is patrick mahomes - Google Search
CENGAGE MINDTAP
Q Search this course
Homework (Ch 03)
In the following table, enter each country's production decision on the third row of the table (marked "Production").
Suppose the country that produces rye trades 14 million bushels of rye to the other country in exchange for 42 million pairs of jeans.
ITED
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," and
enter each country's final consumption of each good on the line marked "Consumption."
atalog
Offers
When the two countries did not specialize, the total production of rye was 18 million bushels per week, and the total production of jeans was 52 million
pairs per week. Because of specialization, the total production of rye has increased by
7 million bushels per week, and the total production of
ions
jeans has increased by
12 million pairs per week.
uccess
Because the two countries produce more rye and more jeans under specialization, each country is able to gain from trade.
enter
FOR YOU
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 the
table. In the following table, enter this difference in the boxes across the last row (marked "Increase in Consumption").
yTools
Contente
Felicidad
Rye
Jeans
Rye
Jeans
(Millions of bushels)
(Millions of pairs)
(Millions of bushels)
(Millions of pairs)
Without Trade
Production
36
12
16
Consumption
6.
36
12
16
dback
With Trade
Production
Trade action
1,706
JAN
2
PAGES
31
3D
6.
help_outline

Image Transcriptionclose

Mind Tap Cengage Learning how old is patrick mahomes - Google Search CENGAGE MINDTAP Q Search this course Homework (Ch 03) In the following table, enter each country's production decision on the third row of the table (marked "Production"). Suppose the country that produces rye trades 14 million bushels of rye to the other country in exchange for 42 million pairs of jeans. ITED 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," and enter each country's final consumption of each good on the line marked "Consumption." atalog Offers When the two countries did not specialize, the total production of rye was 18 million bushels per week, and the total production of jeans was 52 million pairs per week. Because of specialization, the total production of rye has increased by 7 million bushels per week, and the total production of ions jeans has increased by 12 million pairs per week. uccess Because the two countries produce more rye and more jeans under specialization, each country is able to gain from trade. enter FOR YOU 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 the table. In the following table, enter this difference in the boxes across the last row (marked "Increase in Consumption"). yTools Contente Felicidad Rye Jeans Rye Jeans (Millions of bushels) (Millions of pairs) (Millions of bushels) (Millions of pairs) Without Trade Production 36 12 16 Consumption 6. 36 12 16 dback With Trade Production Trade action 1,706 JAN 2 PAGES 31 3D 6.

fullscreen
check_circle

Expert Answer

Step 1

The opportunity cost in the production of Rye and Jeans in C, based on their per hour production can be calculated as follows.

 

Economics homework question answer, step 1, image 1

Step 2

In same manner we can calculate the opportunity cost in the production of Rye and Jeans in F, based on their per hour production as follows.

 

Economics homework question answer, step 2, image 1

 

 

...

Want to see the full answer?

See Solution

Check out a sample Q&A here.

Want to see this answer and more?

Solutions are written by subject experts who are available 24/7. Questions are typically answered within 1 hour.*

See Solution
*Response times may vary by subject and question.
Tagged in

Business

Economics

Related Economics Q&A

Find answers to questions asked by student like you
Show more Q&A
add
question_answer

Q: Back to Assignment Attempts:                   Do No Harm:    / 1   10. Market equilibrium...

A: According to the law of demand and supply, the demand for a product will decline with increasing pro...

question_answer

Q: Why do a firm's profit disappear in the long run?

A: The firms operating in the long run, have to adjust and abide by the time frame which would allow th...

question_answer

Q: 1. Financial institutions in the U.S. economy Suppose Charles would like to use $1,000 of his saving...

A: One way of making a financial investment is to purchase stock or bonds from a private company. Suppo...

question_answer

Q: What are Expansionary and discretionary fiscal policies? Examples to dumb down.

A: Click to see the answer

question_answer

Q: 6. Limitations of GDP Although GDP is a reasonably good measure of a nation's output, it does not ne...

A: Click to see the answer

question_answer

Q: Determine if the statements and expressions regarding costs are true or false. True False Average fi...

A: We can re-create the table correctly as follows.

question_answer

Q: Suppose that Second Republic Bank currently has $150,000 in demand deposits and $97,500 in outstandi...

A: The bank has the demand deposits of $150,000 and the outstanding loan amount of $97,500. It is also ...

question_answer

Q: The image attached presents a Circular Flow Model. The model in this image is missing something.  St...

A: The circular flow model shows the relation between firms and households and the rendered goods and s...

question_answer

Q: Suppose the market starts out in equilibrium with demand curve D and supply curve S. Next, suppose d...

A: Click to see the answer