1. Explain the term absolute advantage. Explain the term comparative advantage.2. Economists are proponents of specialization and trade. List the three primary benefits of international trade.3. Explain the reasons why nations erect trade barriers.4. Fully explain the term exchange rate. 5. Assume the dollar depreciated against the Euro over the past year. Who will be made better off by the fluctuation in the exchange rate? Who will be made worse off by the fluctuation the exchange rate? List and explain three examples for each.6. Consider the production data below when answering the following questions:a) Which country possesses the absolute advantage in wheat production?b) Which country possesses the absolute advantage in lumber production?c) Which country possesses the comparative advantage in wheat production?d) Which country possesses the comparative advantage in lumber production?e) Assume both countries specialize in producing the product in which they enjoy a comparative advantage and trade for the other good. Prior to trade Mexico was allocatively efficient at point F on its production possibilities curve and Germany was allocatively efficient at point H on its production possibility curve. Calculate the increase in output of both products generated through specialization and trade.