Question
3) France and Tunisia both have Mediterranean climates that are excellent for producing/harvesting green beans and tomatoes. The time needed to harvest each crop in
3) France and Tunisia both have Mediterranean climates that are excellent for producing/harvesting green beans and tomatoes. The time needed to harvest each crop in each country is as follows:
Country | Time needed for a worker to harvest a bushel of green beans | Time needed for a worker to harvest a bushel of tomatoes |
France | 2 hours | 2 hours |
Tunisia | 4 hours | 1 hour |
- If a worker in France harvests only green beans, how many bushels can be harvested by the worker in a 40-hour work week? If the worker harvests only tomatoes, how many bushels can be harvested in a 40-hour work week?
- If a worker in Tunisia harvests only green beans, how many bushels can be harvested by the worker in a 40-hour work week? If the worker harvests only tomatoes, how many bushels can be harvested in a 40-hour work week?
- What is the opportunity cost of harvesting a bushel of beans in France? (How many tomatoes would need to be given up?) What is the opportunity cost of harvesting a bushel of beans in Tunisia?
- Which country has the comparative advantage in harvesting beans? If the countries were to specialize and trade, which country should specialize in beans?
4) Consider again the situation in France and Tunisia described in question 1.
a) If each worker spends 20 hours harvesting each product, how many bushels will be harvested in each country and in total for both countries?
FRANCE: Bushels of beans: Bushels of tomatoes:
TUNISIA: Bushels of beans: Bushels of tomatoes:
TOTAL: Bushels of beans: Bushels of tomatoes:
b) If the workers completely specialize and produce only the product they have the comparative advantage in (as described in the previous question), how many bushels of each product will be harvested?
c) What are the potential gains from specialization and trading (how many bushels of beans and how many bushels of tomatoes can be gained?)
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