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3. Why would one country trade with another country? 4. Tina can produce any of the following combinations of goods x and y: a) 100x

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3. Why would one country trade with another country? 4. Tina can produce any of the following combinations of goods x and y: a) 100x and Oy, b)50x and 25y, and c) Ox and 50y. David can produce any of the following combination of goods x and y: a) 50x and 0 y, b), 25x and 40y, and c) Ox and 80y. Who has a comparative advantage in producing good x? of good y? Explain your answer. 5. Using the data in problem 6, prove that both Tina and David can be made better off through specialization and trade. 6. List the sources of an economic growth as listed in the book 7. Comparative advantage and trade allows individuals and nations to consume levels of goods and services beyond the production possibilities frontier. To grasp this concept, how would your life change if a) you could only buy American made goods, b) you could only buy goods made in Texas, c) made in Austin

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