1. Consider an agricultural economy in which any farmer can produce 10 units of beef or 1 unit of corn in a growing season. Initially this economy is cut off from trade with the rest of the world and considers a farmer who chooses to produce corn. When trade is opened up the equilibrium world price of beef is $50 per unit and the equilibrium world price of corn is $400 per unit.

Draw this farmer's budget line before and after trade is opened up. What does the farmer produce under trade? Does the farmer benefit from trade? Explain