1. On different graphs draw the production possibilities frontiers for Germany and France. Which country has an absolute advantage in wine? Which country has an absolute advantage in champagne production? {5 points] 2. What is Germany's marginal opportunity cost of producing wine? What is France's marginal opportunity cost of producing wine? Which country has a comparative advantage in wine production? Which country has a comparative advantage in champagne production? {5 points] 3. Suppose that representatives of Germany and France meet and decide that each could gain from trade with the other. (Note that Germany and France engage in m; no money is necessary.) With trade each country specializes in the good in which it has a comparative advantage. Suppose that Germany and France agree on a price of 1W for 1C. On the graphs from part [a] above, use this information to draw consumption possibilities frontiers for Germany and France. [10 points} 4. Consider the following demand and supply schedules for champagne in France: P Q demanded Q supplied If the world price of champagne is $30. what is the domestic quantity supplied. domestic quantity demanded. and the quantityr exported? [5 points} Calculate total surplus before and after trade. Show your work. {5 points]