B) Comparative Advantage 1. Country A has 100 workers and Country B has 100 workers. Every worker in Country A can produce 6 tons of wheat per year, or can produce 12 tons of com per year. Every worker in Country B can produce 2 tons of wheat per year, or can produce 10 tons of corn per year. a. Which country has an absolute advantage in wheat? country A b. Which country has an absolute advantage in com? country A c. Which country has a comparative advantage in wheat? country A d. Which country has a comparative advantage in com? country A Suppose initially the countries do not trade and Country A has 50 workers producing corn and 50 producing wheat. Country B has 30 workers producing corn and 70 producing wheat. Fill out the following table: Country A Country B Com Produced 600 TONS 300 tons Wheat Produced 300 TONS 140 tons Now the two countries trade with one another. e. What good does Country A specialize in? corn production f. What good does Country B specialize in? corn prouduction If these countries have all workers produce the product that their country has a comparative advantage in, how much do they produce? Country A Country B Com Produced 1200 tons 1000 tons Wheat Produced 600 tons 200 tons g. How much more of each good is produced in total with specialization than when there was no trade? Corn: Wheat: h. Now suppose Country B improves its technology to produce wheat, and now each worker can produce 4 tons of wheat per year. Are the gains from trade between Country A and Country B higher or lower than before? Why