econ 1301 ch 33.2

Taxes placed by governments on imported goods are called

tariffs

Consider the example of trade between the United States and Thailand described in the tables below. Country# of workers needed toproduce 1,000 units- Socks# of workers needed toproduce 1,000 units- Cell PhonesUnited States5 workers1 workerThailand7 workers4 workers Total Production Before Trade CountryCurrent Sock ProductionCurrent Cell Phone ProductionUnited States14,00070,000Thailand10,00017,500Total24,00087,500 Suppose that each country currently has 140 workers and each decides to transfer some amount of labor toward its area of comparative advantage. The United States transfers 15 workers away from socks toward producing cell phones. Thailand transfers 28 workers away from cell phones toward producing socks. What will be the new total output of socks for both countries combined?

25,000

Below is the production possibilities frontier for Japan. It shows that Japan is able to produce either 80 bottles of milk or 50 cartons of eggs using all of its available resources. Also suppose that Japan decides to produce at point A: 60 bottles of milk and 12 cartons of eggs. If Japan engages in international trade andtrades 30 bottles of milk for 30 cartons of eggs with another country, it will be able to consume outside of its production possibilities frontier. How many cartons of eggs will the country have at the end of the exchange?

If Japan trades 30 bottles of milk for 30 cartons of eggs, then Japan will consume 60−30=30 bottles of milk and 12+30=42 cartons of eggs. Japan's consumption point after trade will be point B in the graph below, which is outside of its production possibilities frontier.

Given a world where there are two nations and two goods, if a nation has absolute advantage in both goods, it will still specialize and trade because

the nation will still benefit due to more production of both goods and therefore it will be able to consume outside of its PPF.

How can a country achieve higher levels of competition and a variety of products in an industry with only one or two domestic firms producing a good?

through encouraging intra-industry trade

Comparative advantage is dynamic because

all of the above

Division of labor could increase output on individual, national, and international levels. Which of the following is a reason for that?

all of the above

Low-income countries benefit more from trade than high-income countries do because

all of the above

The purpose of tariffs is

all of the above

Assume a simple model with only two countries: Canada and Italy, and two goods: bacon and sports cars. The table below shows combinations of goods that each country could produce using all of its resources. Which nation would benefit from specializing in the production of bacon and trading bacon for sports cars with the other nation?

canada

Intra-industry trade allows companies to enjoy economies of scale because _____________________.

companies can expand production internationally, sell more units of output and lower per unit costs

The _______________ found in intra-industry trade leads to learning, innovation, and unique skills

division of labor

The value chain describes ______. Select the two correct answers below.

how a good is produced in stages the process or activities by which a company adds value to a product, including production, marketing, and customer service.

Which of the following determine worker productivity in the presence of intra-industry trade?

how firms engage in specific learning about specialized products, including taking advantage of economies of scale

The accumulated skills and education of workers is called _____________.

human capital

When the U.S. imports Honda cars from Japan and exports Ford cars to Japan, we have

intra-industry trade

Below is the production possibilities frontier for Bolivia. It shows that Bolivia is able to produce either 200 bottles of milk or 100 cartons of eggs using all of its available resources. Also suppose that Bolivia decides to produce at point A : 120 bottles of milk and 40 cartons of eggs. If Bolivia engages in international trade and trades 40 bottles of milk for 80 cartons of eggs with another country, it will be able to consume outside of its production possibilities frontier. How many cartons of eggs will it have at the end of the exchange?

120 cartons of eggs

Below is the production possibilities frontier for China. It shows that China is able to produce either 80 batches of apples or 20 batches of pumpkins using all of its available resources. Also suppose that China decides to produce at point A: 40 batches of apples and 10 batches of pumpkins. If China engages in international trade and trades 20 batches of apples for 20 batches of pumpkins with another country, it will be able to consume outside of its production possibilities frontier. How many batches of apples will the country have at the end of the exchange?

20

Below is the production possibilities frontier for Russia. It shows that Russia is able to produce either 80 tons of caviar or 20 batches of potatoes using all of its available resources. Also suppose that Russia decides to produce at point A : 40 tons of caviar and 10 batches of potatoes. If Russia engages in international trade and trades 20 tons of caviar for 20 batches of potatoes with another country, it will be able to consume outside of its production possibilities frontier. How many tons of caviar will the country have at the end of the exchange?

20

Below is the production possibilities frontier for Bolivia. It shows that Bolivia is able to produce either 200 bottles of milk or 100 cartons of eggs using all of its available resources. Also suppose that Bolivia decides to produce at point A : 120 bottles of milk and 40 cartons of eggs. If Bolivia engages in international trade and trades 40 bottles of milk for 80 cartons of eggs with another country, it will be able to consume outside of its production possibilities frontier. How many bottles of milk will it have at the end of the exchange?

After Bolivia trades 40 bottles of milk for 80 cartons of eggs, it will have 80 bottles of milk and 120 cartons of eggs moving its consumption to point B, which is outside of its production possibilities frontier.

Assume a simple model with only two countries: the United States and Germany, and two goods: beer and motorcycles. Suppose that the opportunity cost for the United States to produce 1 beer is 3 motorcycles and the opportunity cost for Germany to produce 1 beer is 1/2 motorcycles. Which of the following statements is true?

Germany would be better off economically if it produced beer and traded with the US for motorcycles.

Below is the production possibilities frontier for the United States. It shows that the United States is able to produce either 100 barrels of oil or 25 bushels of corn using all of its available resources. Also suppose that the United States decides to produce at point A : 60 barrels of oil and 10 bushels of corn. If the United States engages in international trade and trades 20 barrels of oil for 20 bushels of corn with another country, it will be able to consume outside of its production possibilities frontier. How many bushels of corn will it have at the end of the exchange?

30

Below is the production possibilities frontier for India. It shows that India is able to produce either 30 batches of apples or 50 batches of pumpkins using all of its available resources. Also suppose that, India decides to produce at point A : 20 batches of pumpkins and 18 batches of apples. If India engages in international trade and trades 15 batches of pumpkins for 15 batches of apples with another country, it will be able to consume outside of its production possibilities frontier. How many batches of apples will the country have at the end of the exchange?

33

Below is the production possibilities frontier for Pakistan. It shows that Pakistan is able to produce either 15 tons of rice or 25 bales of cotton using all of its available resources. Also suppose that Pakistan decides to produce at point A : 10 bales of cotton and 9 tons of rice. If Pakistan engages in international trade and trades 5 bales of cotton for 5 tons of rice with another country, it will be able to consume outside of its production possibilities frontier. How many bales of cotton will the country have at the end of the exchange?

5

Below is the production possibilities frontier for India. It shows that India is able to produce either 30 batches of apples or 50 batches of pumpkins using all of its available resources. Also suppose that India decides to produce at point A : 20 batches of pumpkins and 18 batches of apples. If India engages in international trade andtrades 15 batches of pumpkins for 15 batches of apples with another country, it will be able to consume outside of its production possibilities frontier. How many batches of pumpkins will the country have at the end of the exchange?

5 batches

Below is the production possibilities frontier for Mexico. It shows that Mexico is able to produce either 120 bottles of milk or 80 slices of cheese using all of its available resources. Also suppose that Mexico decides to produce at point A : 120 bottles of milk and no cheese (full specialization). If Mexico engages in international trade and trades 90 bottles of milk for 90 slices of cheese with another country, it will be able to consume outside of its production possibilities frontier. How many slices of cheese will the country have at the end of the exchange?

90

Consider the example of trade between the United States and Thailand described in the tables below. Country# of workers needed toproduce 1,000 units- Socks# of workers needed toproduce 1,000 units- Cell PhonesUnited States5 workers1 workerThailand7 workers4 workers Total Production Before Trade CountryCurrent Sock ProductionCurrent Cell Phone ProductionUnited States14,00070,000Thailand10,00017,500Total24,00087,500 Suppose that each country currently has 140 workers and each decides to transfer some amount of labor toward its area of comparative advantage. The United States transfers 15 workers away from socks toward producing cell phones. Thailand transfers 28 workers away from cell phones toward producing socks. What will be the new total output of cell phones for both countries combined? Provide your answer below:

95500

Below is the production possibilities frontier for Mexico. It shows that Mexico is able to produce either 120 bottles of milk or 80 slices of cheese using all of its available resources. Also suppose that Mexico decides to produce at point A: 120 bottles of milk and no cheese (full specialization). If Mexico engages in international trade andtrades 90 bottles of milk for 90 slices of cheese with another country, it will be able to consume outside of its production possibilities frontier. How many bottles of milk will the country have at the end of the exchange?

After Mexico trades 90 bottles of milk for 90 slices of cheese, it will have 120−90=30 bottles of milk and 0+90=90 slices of cheese, moving its consumption to point B, which is outside of its production possibilities frontier.

Consider the example of trade between the United States and Thailand described in the tables below. Country# of workers needed toproduce 1,000 units- Socks# of workers needed toproduce 1,000 units- Cell PhonesUnited States5 workers1 workerThailand7 workers4 workers Total Production Before Trade CountryCurrent Sock ProductionCurrent Cell Phone ProductionUnited States14,00070,000Thailand10,00017,500Total24,00087,500 Suppose that each country currently has 140 workers and each decides to transfer some amount of labor toward its area of comparative advantage. The United States transfers 15 workers away from socks toward producing cell phones. Thailand transfers 28 workers away from cell phones toward producing socks. What will be the new total output of cell phones for both countries combined?

In this scenario, we can see that the United States has an absolute advantage in both goods and a comparative advantage in cell phones. Thailand has a comparative advantage in socks. Each country will specialize in producing where they have a comparative advantage by diverting labor toward the production of that good. For the United States: U.S. production of socks decreases by 3,000 units (155×1,000), while U.S. production of cell phones increases by 15,000 (151×1,000) units. For Thailand: Thailand's production of cell phones falls by 7,000 units (284×1,000), while Thailand's production of socks increases by 4,000 units (287×1,000). Thus, once the two countries shift production toward comparative advantage, total output increases for both goods. The total output of cell phones for both countries combined is 95,500. The table below shows the new outcome. CountryCurrent Sock ProductionCurrent Cell Phone ProductionUnited States11,00085,000Thailand14,00010,500Total25,000 95,500

Assume a simple model with only two countries: Japan and Canada, and two goods: cars and bacon. Suppose that the opportunity cost for Japan to produce 1 car is 2 units of bacon and the opportunity cost for Canada to produce 1 car is 4.5 units of bacon. Which of the following statements is true?

Japan would be economically better off if it produced cars and traded with Canada for bacon. Since the opportunity cost for Japan to produce 1 car (2 units of bacon) is lower than Canada's opportunity cost to produce 1 car (4.5 units of bacon), it has a comparative advantage in the production of cars and would benefit from specializing in car production.

The United States and Japan both produce beef and cars. The table below describes the production capabilities of both countries. Hours to Produce 1 ton of Beef Hours to Produce Cars Opportunity Cost of 1 ton of BeefOpportunity Cost of CarsUnited States20150 0.13 cars7.5 tons of beefJapan50200 0.25 cars4 tons of beef The graph below shows the production possibilities frontier for the United States and Japan. Suppose that the countries completely specialize in the production of the good for which they have a comparative advantage, the United States only produces beef and Japan only produces cars. On the graph below, illustrate the consumption of the United States and Japan if the U.S. exports 500 tons of beef to Japan in exchange for Japan exporting 100 cars to the United States. The "U.S. Consumption" point and the "Japan Consumption" point are misplaced. Relocate the points to reflect the consumption bundles after trade for both countries.

The United States will consume 1,000 tons of beef and 100 cars (1000,100) and Japan will consume 500 tons of beef and 50 cars (500,50). Since the United States has the comparative advantage in the production of beef, they will produce 1,500 tons of beef and no cars. Since Japan has the comparative advantage in the production of cars, they will produce 150 cars and no beef. The terms of trade will be 500 tons of beef for 100 cars. The U.S. will export beef and import cars, while Japan will export cars and import beef. The table below shows how the consumption bundle is determined.

The United States and Colombia both produce coffee and trucks. The table below describes the production capabilities of both countries. Hours to Produce 1 ton of CoffeeHours to Produce a Truck Opportunity Cost of 1 ton of CoffeeOpportunity Cost of a TruckUnited States10200 0.05 trucks20 tons of coffeeColombia25750 0.03 trucks30 tons of coffee The graph below shows the production possibilities frontier for the United States and Colombia. Suppose that the countries completely specialize in the production of the good for which they have a comparative advantage, the United States only produces trucks and Colombia only produces coffee. On the graph below, illustrate the consumption of the United States and Colombia if the U.S. exports 50 trucks to Colombia in exchange for Colombia exporting 1,200 tons of coffee to the United States. The "U.S. Consumption" point and the "Colombia Consumption" point are misplaced. Relocate the points to reflect the consumption bundles after trade for both countries. Provide your answer below:

The United States will consume 1,200 tons of coffee and 400 trucks (1200,400) and Colombia will consume 2,400 tons of coffee and 50 trucks (2400,50).

The United States and South Africa both produce tea and smart phones. The table below describes the production capabilities of both countries. Hours to Produce 1 ton of TeaHours to Produce 1 Smart PhoneOpportunity Cost of 1 Ton of TeaOpportunity Cost of Smart PhonesUnited States10500.2 smart phones5 tons of teaSouth Africa151000.15 smart phones6.7 tons of tea The graph below shows the production possibilities frontier for the United States and South Africa. Suppose that the countries completely specialize in the production of the good for which they have a comparative advantage, the United States only produces smart phones and South Africa only produces tea. On the graph below, illustrate the consumption of the United States and South Africa if the U.S. exports 200 smart phones to South Africa in exchange for South Africa exporting 1,250 tons of tea to the United States. The "U.S. Consumption" point and the "South Africa Consumption" point are misplaced. Relocate the points to reflect the consumption bundles after trade for both countries. Provide your answer below:

The United States will consume 1,250 tons of tea and 700 smart phones (1250,700) and South Africa will consume 1,750 tons of tea and 200 smart phones (1750,200). Since the United States has the comparative advantage in the production of smart phones, they will produce 900 smart phones and no tea. South Africa has the comparative advantage in the production of tea, they will produce 3,000 tons of tea and no smart phones. The terms of trade will be 1,250 tons of tea for 200 smart phones. The U.S. will export smart phones and import tea, while South Africa will export tea and import smart phones. The table below shows how the consumption bundle is determined.

The United States and Mexico both produce apples and couches. The table below describes the production capabilities of both countries. Hours to Produce 1 ton of ApplesHours to Produce Couches Opportunity Cost of 1 ton of ApplesOpportunity Cost of CouchesUnited States1050 0.2 couches5 tons of applesMexico5075 0.67 couches1.5 tons of apples The graph below shows the production possibilities frontier for the United States and Mexico. Suppose that the countries completely specialize in the production of the good for which they have a comparative advantage, the United States only produces apples and Mexico only produces couches. On the graph below, illustrate the consumption of the United States and Mexico if the U.S. exports 600 tons of apples to Mexico in exchange for Mexico exporting 200 couches to the United States. The "U.S. Consumption" point and the "Mexico Consumption" point are misplaced. Relocate the points to reflect the consumption bundles after trade for both countries.

The United States will consume 1,800 tons of apples and 200 couches (1800,200) and Mexico will consume 600 tons of apples and 120 couches (600,120). Since the United States has the comparative advantage in the production of apples, they will produce 2,400 tons of apples and no couches. Since Mexico has the comparative advantage in the production of couches, they will produce 320 couches and no apples. The terms of trade will be 600 tons of apples for 200 couches. The U.S. will export apples and import couches, while Mexico will export couches and import apples. The table below shows how the consumption bundle is determined.

The United States and Mexico both produce furniture and tires. The table below describes the production capabilities of both countries. Hours to Produce 1 Units of Furniture Hours to Produce 1 Tire Opportunity Cost of FurnitureOpportunity Cost of TiresUnited States7525 3 tires0.33 unit of furnitureMexico30050 6 tires0.17 unit of furniture The graph below shows the production possibilities frontiers for the United States and Mexico. Suppose that the countries completely specialize in the production of the good for which they have a comparative advantage: the United States only produces furniture and Mexico only produces tires. On the graph below, illustrate the consumption of the United States and Mexico if the U.S. exports 500 units of furniture to Mexico in exchange for Mexico exporting 2,000 tires to the United States. The "U.S. Consumption" point and the "Mexico Consumption" point are misplaced. Relocate the points to reflect the consumption bundles after trade for both countries.

The United States will consume 1,900 units of furniture and 2,000 tires (1900,2000) and Mexico will consume 500 units of furniture and 1,600 tires (500,1600).

The United States and Colombia both produce coffee and trucks. The table below describes the production capabilities of both countries. Hours to Produce 1 ton of CoffeeHours to Produce a Truck Opportunity Cost of 1 ton of CoffeeOpportunity Cost of 1 TruckUnited States5200 0.03 trucks (=5/200) 40 tons of coffee (=200/5) Colombia10500 0.02 trucks (=10/500) 50 tons of coffee (=500/10) The graph below shows the production possibilities frontier for the United States and Colombia. Suppose that the countries completely specialize in the production of the good for which they have a comparative advantage, the United States only produces trucks and Colombia only produces coffee. On the graph below, illustrate the consumption of the United States and Colombia if the U.S. exports 300 trucks to Colombia in exchange for Colombia exporting 13,500 tons of coffee to the United States. How To Solve: The "U.S. Consumption" and "Colombia Consumption" points are misplaced. Relocate the points to reflect the consumption bundles after trade for both countries. These two points are draggable. Provide your answer below:

The United States will consume 13,500 tons of coffee and 600 trucks (13500,600) and Colombia will consume 4,500 tons of coffee and 300 trucks (4500,300). Since the United States has the comparative advantage in the production of trucks, they will produce 900 trucks and no coffee. Since Colombia has the comparative advantage in the production of coffee, they will produce 18,000 tons of coffee and no trucks. The terms of trade will be 13,500 tons of coffee for 300trucks. The U.S. will export trucks and import coffee, while Colombia will export coffee and import trucks. The table below shows how the consumption bundle is determined.

The United States and Brazil both produce sugar and bicycles. The table below describes the production capabilities of both countries. Hours to Produce 1 ton of SugarHours to Produce 1 Bicycle Opportunity Cost of 1 ton of SugarOpportunity Cost of 1 BicycleUnited States15150 0.1 bicycle10 tons of sugarBrazil20300 0.07 bicycle15 tons of sugar The graph below shows the production possibilities frontiers for the United States and Brazil. Suppose that the countries completely specialize in the production of the good for which they have a comparative advantage: the United States only produces bicycles and Brazil only produces sugar. On the graph below, illustrate the consumption of the United States and Brazil if the U.S. exports 150 bicycles to Brazil in exchange for Brazil exporting 2,000 tons of sugar to the United States. The "U.S. Consumption" point and the "Brazil Consumption" point are misplaced. Relocate the points to reflect the consumption bundles after trade for both countr

The United States will consume 2,000 tons of sugar and 650 bicycles (2000,650) and Brazil will consume 4,000 tons of sugar and 150 bicycles (4000,150).

The United States and Ireland both produce potatoes and cars. The table below describes the production capabilities of both countries. Hours to Produce 1 ton of PotatoesHours to Produce 1 Car Opportunity Cost of 1 PotatoOpportunity Cost of 1 CarUnited States20500 0.04 cars25 tons of potatoesIreland251,000 0.03 cars40 tons of potatoes The graph below shows the production possibilities frontiers for the United States and Ireland. Suppose that the countries completely specialize in the production of the good for which they have a comparative advantage: the United States only produces cars and Ireland only produces potatoes. On the graph below, illustrate the consumption of the United States and Ireland if the U.S. exports 100 cars to Ireland in exchange for Ireland exporting 3,000 tons of potatoes to the United States. The "U.S. Consumption" point and the "Ireland Consumption" point are misplaced. Relocate the points to reflect the consumption bundles after trade for both countries.

The United States will consume 3,000 tons of potatoes and 140 cars (3000,140) and Ireland will consume 1,800 tons of potatoes and 100 cars (1800,100).

The United States and Ireland both produce potatoes and appliances. The table below describes the production capabilities of both countries. Hours to Produce 1 ton of PotatoesHours to Produce Appliances Opportunity Cost of 1 ton of PotatoesOpportunity Cost of AppliancesUnited States5100 0.05 appliances20 tons of potatoesIreland10300 0.03 appliances30 tons of potatoes The graph below shows the production possibilities frontier for the United States and Ireland. Suppose that the countries completely specialize in the production of the good for which they have a comparative advantage, the United States only produces appliances and Ireland only produces potatoes. On the graph below, illustrate the consumption of the United States and Ireland if the U.S. exports 160 appliances to Ireland in exchange for Ireland exporting 4,000 tons of potatoes to the United States. The "U.S. Consumption" point and the "Ireland Consumption" point are misplaced. Relocate the points to reflect the consumption bundles after trade for both countries.

The United States will consume 4,000 tons of potatoes and 440 appliances (4000,440) and Ireland will consume 2,000 tons of potatoes and 160 appliances (2000,160).

The United States and Japan both produce milk and appliances. The table below describes the production capabilities of both countries. Hours to Produce Gallons of Milk Hours to Produce Appliances Opportunity Cost of Gallons of Milk Opportunity Cost of AppliancesUnited States20100 0.2 appliances5 gallons of milkJapan100300 0.33 appliances3 gallons of milk The graph below shows the production possibilities frontier for the United States and Japan. Suppose that the countries completely specialize in the production of the good for which they have a comparative advantage, the United States only produces milk and Japan only produces appliances. On the graph below, illustrate the consumption of the United States and Japan if the U.S. exports 1,200 gallons of milk to Japan in exchange for Japan exporting 300 appliances to the United States. How To Solve: The "U.S. Consumption" and "Japan Consumption" points are misplaced. Relocate the points to reflect the consumption bundles after trade for both countries. These two points are draggable. Provide your answer below:

The United States will consume 4,800 gallons of milk and 300 appliances (4800,300) and Japan will consume 1,200 gallons of milk and 100 appliances (1200,100).

The United States and Mexico both produce soccer balls and cars. The table below describes the production capabilities of both countries. Hours to Produce Soccer Balls Hours to Produce Cars Opportunity Cost of Soccer BallsOpportunity Cost of CarsUnited States10100 0.1 cars (=10/100) 10 soccer balls (=100/10) Mexico20250 0.08 cars (=20/250) 12.5 soccer balls (=250/20) The graph below shows the production possibilities frontier for the United States and Mexico. Suppose that the countries completely specialize in the production of the good for which they have a comparative advantage, the United States only produces cars and Mexico only produces soccer balls. On the graph below, illustrate the consumption of the United States and Mexico if the U.S. exports 500 cars to Mexico in exchange for Mexico exporting 5,500 soccer balls to the United States. How To Solve: The "U.S. Consumption" and "Mexico Consumption" points are misplaced. Relocate the points to reflect the consumption bundles after trade for both countries. These two points are draggable. Provide your answer below:

The United States will consume 5,500 soccer balls and 1,500 cars (5500,1500) and Mexico will consume 4,500 soccer balls and 500 cars (4500,500).

The United States and Germany both produce oranges and cars. The table below describes the production capabilities of both countries. Hours to Produce 1 ton of OrangesHours to Produce 1 Car Opportunity Cost of 1 ton of OrangesOpportunity Cost of 1 CarUnited States20500 0.04 cars25 tons of orangesGermany100750 0.13 cars7.5 tons of oranges The graph below shows the production possibilities frontiers for the United States and Germany. Suppose that both countries completely specialize in the production of the good for which they have a comparative advantage: the United States only produces oranges and Germany only produces cars. On the graph below, illustrate the consumption of the United States and Germany if the U.S. exports 1,500 tons of oranges to Germany in exchange for Germany exporting 100 cars to the United States. The "U.S. Consumption" point and the "Germany Consumption" point are misplaced. Relocate the points to reflect the consumption bundles after trade for both countries. Provide your answer below:

The United States will consume 6,000 tons of oranges and 100 cars (6000,100) and Germany will consume 1,500 tons of oranges and 100 cars (1500,100).

The United States and France both produce lemons and computer software. The table below describes the production capabilities of both countries. Hours to Produce Bushels of Lemons Hours to Produce Computer Software Opportunity Cost of Bushels of LemonsOpportunity Cost of Computer SoftwareUnited States25100 0.25 computer software4 bushels of lemonsFrance1075 0.13 computer software7.5 bushels of lemons The graph below shows the production possibilities frontier for the United States and France. Suppose that the countries completely specialize in the production of the good for which they have a comparative advantage, the United States only produces computer software and France only produces lemons. On the graph below, illustrate the consumption of the United States and France if the U.S. exports 100 units of computer software to France in exchange for France exporting 600 bushels of lemons to the United States. The "U.S. Consumption" point and the "France Consumption" point are misplaced. Relocate the points to reflect the consumption bundles after trade for both countries. Provide your answer below:

The United States will consume 600 bushels of lemons and 140 units of computer software (600,140) and France will consume 1,800 bushels of lemons and 100 units of computer software (1,800,100).

The United States and China both produce cod fish and coffee makers. The table below describes the production capabilities of both countries. The graph below shows the production possibilities frontier for the United States and China. Suppose that the countries completely specialize in the production of the good for which they have a comparative advantage, the United States only produces coffee makers and China only produces cod. On the graph below, illustrate the consumption of the United States and China if the U.S. exports 100 coffee makers to China in exchange for China exporting 600 pounds of cod to the United States. The "U.S. Consumption" point and the "China Consumption" point are misplaced. Relocate the points to reflect the consumption bundles after trade for both countries.

The United States will consume 600 pounds of cod and 460 coffee makers (600,460) and China will consume 800 pounds of cod and 100 coffee makers (800,100).

The United States and Mexico both produce units of furniture and tires. The table below describes the production capabilities of both countries. Hours to Produce Units of Furniture Hours to Produce Tires Opportunity Cost of FurnitureOpportunity Cost of TiresUnited States1040 0.25 tires4 units of furnitureMexico2550 0.5 tires2 units of furniture The graph below shows the production possibilities frontier for the United States and Mexico. Suppose that the countries completely specialize in the production of the good for which they have a comparative advantage, the United States only produces furniture and Mexico only produces tires. On the graph below, illustrate the consumption of the United States and Mexico if the U.S. exports 5,500 units of furniture to Mexico in exchange for Mexico exporting 2,000 tires to the United States. The "U.S. Consumption" point and the "Mexico Consumption" point are misplaced. Relocate the points to reflect the consumption bundles after trade for both countries.

The United States will consume 8,500 units of furniture and 2,000 tires (8500,2000) and Mexico will consume 5,500 units of furniture and 800 tires (5500,800).

Consider the example of trade between the United States and Japan described in the tables below. Country# of workers needed toproduce 1,000 units- Cars# of workers needed toproduce 1,000 units- RVsUnited States5 workers1 workerJapan6 workers5 workers Total Production Before Trade CountryCurrent Car ProductionCurrent RV ProductionUnited States15,00075,000Japan12,50015,000Total27,50090,000 Suppose that each country currently has 150 workers and each decides to transfer some amount of labor toward its area of comparative advantage. The United States transfers 20 workers away from cars toward producing RVs. Japan transfers 30 workers away from RVs toward producing cars. What will be the new total output of RVs for both countries combined?

Thus, once the two countries shift production toward comparative advantage, total output increases for both goods. The total output of RVs for both countries combined is 104,000.

consider the example of trade between the United States and Japan described in the tables below. Country# of workers needed toproduce 1,000 units- Cars# of workers needed toproduce 1,000 units- RVsUnited States3 workers2 workersJapan4 workers3 workers Total Production Before Trade CountryCurrent Car ProductionCurrent RV ProductionUnited States16,00024,000Japan12,00016,000Total28,00040,000 Suppose that each country currently has 96 workers and each decides to transfer some amount of labor toward its area of comparative advantage. The United States transfers 15 workers away from cars toward producing RVs. Japan transfers 21 workers away from RVs toward producing cars. What will be the new total output of RVs for both countries combined?

Thus, once the two countries shift production toward comparative advantage, total output increases for both goods. The total output of RVs for both countries combined is 40,500.

Consider the example of trade between the United States and Mexico described in the tables below. Country# of workers needed toproduce 1,000 units- Shoes# of workers needed toproduce 1,000 units- TVsUnited States4 workers2 workersMexico5 workers5 workers Total Production Before Trade CountryCurrent Shoe ProductionCurrent TV ProductionUnited States7,50015,000Mexico6,0006,000Total13,50021,000 Suppose that each country currently has 60 workers and each decides to transfer some amount of labor toward its area of comparative advantage. The United States transfers 12 workers away from shoes toward producing TVs. Mexico transfers 20 workers away from TVs toward producing shoes. What will be the new total output of TVs for both countries combined? Provide your answer below:

Thus, once the two countries shift production toward comparative advantage, total output increases for both goods. The total output of TVs for both countries combined is 23,000.

Consider the example of trade between the United States and Mexico described in the tables below. Country# of workers needed toproduce 1,000 units- Shoes# of workers needed toproduce 1,000 units- TVsUnited States4 workers1 workerMexico5 workers2 workers Total Production Before Trade CountryCurrent Shoe ProductionCurrent TV ProductionUnited States5,00020,000Mexico4,00010,000Total9,00030,000 Suppose that each country currently has 40 workers and each decides to transfer some amount of labor toward its area of comparative advantage. The United States transfers 8 workers away from shoes toward producing TVs. Mexico transfers 15 workers away from TVs toward producing shoes. What will be the new total output of TVs for both countries combined?

Thus, once the two countries shift production toward comparative advantage, total output increases for both goods. The total output of TVs for both countries combined is 30,500.

Consider the example of trade between the United States and Mexico described in the tables below. Country# of workers needed toproduce 1,000 units- Shoes# of workers needed toproduce 1,000 units- TVsUnited States6 workers1 workerMexico8 workers5 workers Total Production Before Trade CountryCurrent Shoe ProductionCurrent TV ProductionUnited States10,00060,000Mexico7,50012,000Total17,50072,000 Suppose that each country currently has 120 workers and each decides to transfer some amount of labor toward its area of comparative advantage. The United States transfers 30 workers away from shoes toward producing TVs. Mexico transfers 50 workers away from TVs toward producing shoes. What will be the new total output of TVs for both countries combined?

Thus, once the two countries shift production toward comparative advantage, total output increases for both goods. The total output of TVs for both countries combined is 92,000.

Consider the example of trade between the United States and Japan described in the tables below. Country# of workers needed toproduce 1,000 units- Cars# of workers needed toproduce 1,000 units- RVsUnited States5 workers1 workerJapan6 workers5 workers Total Production Before Trade CountryCurrent Car ProductionCurrent RV ProductionUnited States15,00075,000Japan12,50015,000Total27,50090,000 Suppose that each country currently has 150 workers and each decides to transfer some amount of labor toward its area of comparative advantage. The United States transfers 20 workers away from cars toward producing RVs. Japan transfers 30 workers away from RVs toward producing cars. What will be the new total output of cars for both countries combined?

Thus, once the two countries shift production toward comparative advantage, total output increases for both goods. The total output of cars for both countries combined is 28,500.

Consider the example of trade between the United States and Thailand described in the tables below. Country# of workers needed toproduce 1,000 units- Socks# of workers needed toproduce 1,000 units- Cell PhonesUnited States5 workers1 workerThailand6 workers3 workers Total Production Before Trade CountryCurrent Sock ProductionCurrent Cell Phone ProductionUnited States9,00045,000Thailand7,50015,000Total16,50060,000 Suppose that each country currently has 90 workers and each decides to transfer some amount of labor toward its area of comparative advantage. The United States transfers 10 workers away from socks toward producing cell phones. Thailand transfers 18 workers away from cell phones toward producing socks. What will be the new total output of cell phones for both countries combined? Provide your answer below:

Thus, once the two countries shift production toward comparative advantage, total output increases for both goods. The total output of cell phones for both countries combined is 64,000.

Consider the example of trade between the United States and Brazil described in the tables below. Country# of workers needed toproduce 1,000 units- Chairs# of workers needed toproduce 1,000 units- LaptopsUnited States8 workers3 workersBrazil10 workers5 workers Total Production Before Trade CountryCurrent Chair ProductionCurrent Laptop ProductionUnited States7,50020,000Brazil6,00012,000Total13,50032,000 Suppose that each country currently has 120 workers and each decides to transfer some amount of labor toward its area of comparative advantage. The United States transfers 24 workers away from chairs toward producing laptops. Brazil transfers 35 workers away from laptops toward producing chairs. What will be the new total output of chairs for both countries combined?

Thus, once the two countries shift production toward comparative advantage, total output increases for both goods. The total output of chairs for both countries combined is 14,000.

Consider the example of trade between the United States and Brazil described in the tables below. Country# of workers needed toproduce 1,000 units- Chairs# of workers needed toproduce 1,000 units- LaptopsUnited States5 workers1 workerBrazil6 workers4 workers Total Production Before Trade CountryCurrent Chair ProductionCurrent Laptop ProductionUnited States6,00030,000Brazil5,0007,500Total11,00037,500 Suppose that each country currently has 60 workers and each decides to transfer some amount of labor toward its area of comparative advantage. The United States transfers 15 workers away from chairs toward producing laptops. Brazil transfers 24 workers away from laptops toward producing chairs. What will be the new total output of laptops for both countries combined?

Thus, once the two countries shift production toward comparative advantage, total output increases for both goods. The total output of laptops for both countries combined is 46,500.

Consider the example of trade between the United States and Brazil described in the tables below. Country# of workers needed toproduce 1,000 units- Chairs# of workers needed toproduce 1,000 units- LaptopsUnited States8 workers3 workersBrazil10 workers5 workers Total Production Before Trade CountryCurrent Chair ProductionCurrent Laptop ProductionUnited States7,50020,000Brazil6,00012,000Total13,50032,000 Suppose that each country currently has 120 workers and each decides to transfer some amount of labor toward its area of comparative advantage. The United States transfers 24 workers away from chairs toward producing laptops. Brazil transfers 35 workers away from laptops toward producing chairs. What will be the new total output of laptops for both countries combined? Provide your answer below:

Thus, once the two countries shift production toward comparative advantage, total output increases for both goods. The total output of laptops for both countries combined is correct answer33,000.

Consider the example of trade between the United States and Mexico described in the tables below. Country# of workers needed toproduce 1,000 units- Shoes# of workers needed toproduce 1,000 units- TVsUnited States4 workers1 workerMexico5 workers2 workers Total Production Before Trade CountryCurrent Shoe ProductionCurrent TV ProductionUnited States5,00020,000Mexico4,00010,000Total9,00030,000 Suppose that each country currently has 40 workers and each decides to transfer some amount of labor toward its area of comparative advantage. The United States transfers 8 workers away from shoes toward producing TVs. Mexico transfers 15 workers away from TVs toward producing shoes. What will be the new total output of shoes for both countries combined?

Thus, once the two countries shift production toward comparative advantage, total output increases for both goods. The total output of shoes for both countries combined is 10,000.

Consider the example of trade between the United States and Mexico described in the tables below. Country# of workers needed toproduce 1,000 units- Shoes# of workers needed toproduce 1,000 units- TVsUnited States4 workers2 workersMexico5 workers5 workers Total Production Before Trade CountryCurrent Shoe ProductionCurrent TV ProductionUnited States7,50015,000Mexico6,0006,000Total13,50021,000 Suppose that each country currently has 60 workers and each decides to transfer some amount of labor toward its area of comparative advantage. The United States transfers 12 workers away from shoes toward producing TVs. Mexico transfers 20 workers away from TVs toward producing shoes. What will be the new total output of shoes for both countries combined? Provide your answer below:

Thus, once the two countries shift production toward comparative advantage, total output increases for both goods. The total output of shoes for both countries combined is 14,500.

Consider the example of trade between the United States and Thailand described in the tables below. Country# of workers needed toproduce 1,000 units- Socks# of workers needed toproduce 1,000 units- Cell PhonesUnited States5 workers1 workerThailand6 workers3 workers Total Production Before Trade CountryCurrent Sock ProductionCurrent Cell Phone ProductionUnited States9,00045,000Thailand7,50015,000Total16,50060,000 Suppose that each country currently has 90 workers and each decides to transfer some amount of labor toward its area of comparative advantage. The United States transfers 10 workers away from socks toward producing cell phones. Thailand transfers 18 workers away from cell phones toward producing socks. What will be the new total output of socks for both countries combined? Provide your answer below:

Thus, once the two countries shift production toward comparative advantage, total output increases for both goods. The total output of socks for both countries combined is 17,500.