Consider two neighboring island countries, Botoga and Fiatstan. Each has 24,000 labor hours available per week that it can use to produce wheat, jeans, or a combination of both. The following table shows the amount of labor hours required to produce 1 bushel of wheat or 1 pair of jeans.

Wheat Jeans

(Labors hours per Bushel) (Labors hours per pair)

Botoga 48 12

Fiastan 20 10

___________has an absolute advantage in the production of wheat and ___________ has an absolute advantage in the production of jeans.

Initially, suppose Botoga uses 18,000 hours of labor per week to produce wheat and 6,000 hours per week to produce jeans, while Fiatstan uses 6,000 hours of labor per week to produce wheat and 18,000 hours per week to produce jeans. Assume there are no other countries willing to trade goods, so in the absence of trade between these two countries, each country consumes the amount of wheat and jeans it produces.

Botoga's opportunity cost of producing 1 bushel of wheat is _________ of jeans, and Fiatstan's opportunity cost of producing 1 bushel of wheat is _________ of jeans. Therefore,____________ has a comparative advantage in the production of wheat, and ___________ has a comparative advantage in the production of jeans.

When neither country specializes, the total production of wheat is__________ bushels per week, and the total production of jeans is _________ pairs per week.

Suppose that Botoga completely specializes in the production of the good in which it has a comparative advantage, producingonlythat good. It will produce ________ ______________ . Suppose also that Fiatstan does not specialize and uses 18,000 hours of labor to produce wheat and 6,000 hours of labor to produce jeans. It will produce __________bushels of wheat and __________pairs of jeans.

Suppose Botoga and Fiatstan agree to trade with each other, exchanging 410 bushels of wheat for 1,230 pairs of jeans. In particular, Botoga will export the goods it produces, and Fiatstan will export the goods that Botoga does not produce.

With trade, Botoga will________ wheat and _________ jeans. Fiatstan will_______ wheat and _______ jeans.

When Botoga specializes and Fiatstan still produces the combination of goods using 18,000 hours of labor to produce wheat and 6,000 hours of labor to produce jeans, the total production of wheat becomes________ bushels per week, and the total production of jeans becomes________pairs per week