1. Germany 2. France * Absolute Advantage 1. Wine 2. Sausage * Comparative Advantage 1. Wine 2. Sausage * Trading Ratios: 1. Germany will produce and export _______________ (Item and number of units) for _____________ (Item and number of units) 2. France will produce and export _______________ (Item and number of units) for _____________ (Item and number of units) * * Model for your Answer * Production Ratios Cheese to Bread 1. England 4 cheese to 1 Bread - Internal Cost (4C:1B) or (1C:1/4 B) 2. Spain 2 cheese to 1 Bread - Internal Cost(2C:1B) or (1C : 1/2 B) * Absolute Advantage 1. Cheese: England 2. Bread: England * Comparative Advantage 1. Cheese: England 2. Bread: Spain * Trading Ratios: 1. England will produce and export 1 unit of cheese in exchange for 1/3 unit of bread 2. Spain will produce and export 1 unit of bread in exchange for 3 cheese