Asst11f09

Asst11f09 - AGEC 217 Assignment 11 Due11/20/09 Name _Seat...

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AGEC 217 Assignment 11 Due11/20/09 Name _______________________________________________________Seat No. ________________ 1. (20) The US and France can both produce apples and grapes. The US has 34 units of resources and France has 44. The production from one unit of resources in each country is as follows: Product US France Grapes 9 6 Apples 8 7 a. Which country has an absolute advantage in grapes? ________ b. Show your calculations and/or comparisons you use to decide. c. Which country has an absolute advantage in apples? ________ d. Show your calculations and/or comparisons you use to decide. e. Which country has a comparative advantage in grapes? _______ f. Show your calculations and/or comparisons you use to decide. g. Which country has a comparative advantage in apples? ______ h. Show your calculations and/or comparisons you use to decide. ___________________________________________________________________________________ i. Which country should specialize in producing grapes? ______ j. Which country should specialize in producing apples? ______ 2. (20) To find whether or not trade pays we will compare the amount of products available to consumers when each country produces for itself with the amount available with specialization and trade. a. First estimate how much each country will have of each product if they each produce for themselves,
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dividing their resources evenly between the products. (Resources are the number of inputs and production is how much gets produced.)
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Asst11f09 - AGEC 217 Assignment 11 Due11/20/09 Name _Seat...

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