cengage.com/staticb/ui/evo/index.html?deploymentid-5982812502699860322945970871&eISBN=97803571336068snapshotld=3905442&id=204 CENGAGE MINDTAP Homework (Ch 03) Back to Assignment Attempts 15 1 Average 1.3 / 4 4. Specialization and trade When a country has a comparative advantage in the production of a good, it means that it can produce this good at a lower opportunity cost than its trading partner. Then the country will specialize in the production of this good and trade it for other goods. The following graphs show the production possibilities frontiers (PPFs) for Yosemite and Denali. Both countries produce corn and lentils, each initially the letter A. (i.e., before specialization and trade) producing 18 million pounds of corn and 9 million pounds of lentils, as indicated by the grey stars marked with Yosemite Denal to PPF N G N8 8 5 NGON 8 8 6 LENTILS (Millions of pounds) LENTILS (Millions of pounds) PPF O 12 18 24 30 38 42 12 18 24 30 30 42 48 CORN (Millions of pounds) CORN (Millions of pounds) corn , while Denali has a comparative advantage in the Yosemite has a comparative advantage in the production of .Suppose that Yosemite and Denali specialize in the production of the goods in which each has a production of lentils comparative advantage. After specialization, the two countries can produce a total of | 36 million pounds of corn and 36 million pounds of lentils. Suppose that Yosemite and Denali agree to trade. Each country focuses its resources on producing only the good in which it has a comparative O P When a country has a comparative advantage in the production of a good, it means that lower opportunity cost than its trading partner. Then the country wil specialize in the pro 4. Specialization and trade The following graphs show the production possibilities frontiers (PPFs) for Shena produce almonds and basil, each initially (i.e., before specialization and trac trade it for other goods, almonds and 15 million pounds of basil, as indicated by the grey starsCENGAGE MINDTAP engage.com/staticb/ui/evo/index.html?deploymentid-5982812502699860322945970871&elSBN=97803571336068snapshotld=3905442&id=2049054 Homework (Ch 03) lentils. comparative advantage. After specialization, the two countries can produce a total of |36 million pounds of corn and 36 million pounds of Suppose that Yosemite and Denali agree to trade. Each country focuses its resources on producing only the good in which it has a comparative trade between Yosemite and Denali. advantage. The countries decide to exchange 12 million pounds of corn for 12 million pounds of lentils. This ratio of goods is known as the price of The following graph shows the same PPF for Yosemite as before, as well as its initial consumption at point A. Place a black point (plus symbol) on the graph to indicate Yosemite's consumption after trade. Note: Dashed drop lines will automatically extend to both axes. Yosemite to 8 Consumption After Trade LENTILS (Millions of pounds) PPF 12 18 24 30 42 CORN (Millions of pounds) The following graph shows the same PPF for Denali as before, as well as its initial consumption at point A. As you did for Yosemite, place a black point (plus symbol) on the following graph to indicate Denali's consumption after trade. Denali O W X Gh- when a country has a comparative advantage in the production of & just to weara put t can lower opportunity cost than its trading porter, that the thentry witt pro 4. Specialization and trade The following graphs show the production penabilion truben (of q) tos She produce almonds and bast, each initialy tut, before special trade it for other gocos. almonds and 15 million pounds of text, as indicated by the prey sears 0CENGAGE |MINDTAP gage.com/staticb/ui/evo/index.html?deploymentid-5982812502699860322945970871&eISBN=9780357133606&snapshotid=39054428 Homework (Ch 03) 18 24 30 CORN (Millions of pounds) 38 42 48 The following graph shows the same PPF for Denali as before, as well as its initial consumption at point A. As you did for Yosemite, place a black point (plus symbol) on the following graph to indicate Denali's consumption after trade. (? Denali 48 PPF Consumption After Trade 30 24 LENTILS (Millions of pounds) 18 12 A 12 18 24 30 36 CORN (Millions of pounds) True or False: Without engaging in international trade, Yosemite and Denali would have been able to consume at the after-trade consumption bundles. (Hint: Base this question on the answers you previously entered on this page.) True False Grade It Now Save & Continue Continue without saving P O W X CA KCE When a country has a comparative advantage in the production of a 4. Specialization and trade lower opportunity cost than its trading partner. Then the country The following graphs show the production possibilities trade it for other goods. produce almonds and basil, each In taly [te., bef almonds and 15 million pounds of basil, as