Consider two countries, the United States and the United Kingdom that produce only two goods, cloth and wheat. Given the differences in resources between the two countries, the resources necessary to produce each good differs. The time it takes to produce a unit of each good is show on the table below. Assume both countries have 24 hours to produce. Country US UK 1/2 Cloth (hours per yard) 6 4 a) For the US, the opportunity cost of producing one yard of cloth is 3 bushels of wheat. (hours per bushel) Wheat b) For the US, the opportunity cost of producing one bushel of wheat is 1/3 yards of cloth. c) For the UK, the opportunity cost of producing one yard of cloth is bushels of wheat. d) For the UK, the opportunity cost of producing one bushel of wheat is 2 yards of cloth. 2 8 Suppose that without trade the US chooses to produce 2 yards of cloth and 6 bushels of wheat with its 24 labor hours. Suppose without trade the UK chooses to produce 2 yards of cloth and 2 bushels of wheat. Come up with a production and trade strategy that will result in BOTH the US and the UK being better off than they were without trade. To ensure they are better off, they must have more of at least one of the goods, without having less of either good. (Your answer should be in the form of the US produces yards of cloth and bushels of wheat. The UK produces US then trades away the UK) S S M DE PODE SERRE yards of cloth and _____ bushels of wheat. The cloth/wheat and in return receives cloth/wheat from SANA, MA: 100