Country A has 120 units of labor available, while country B has 240 units available. Each country can produce two goods. The table lists the respective unit labor requirements, i.e., the number of units of labor it takes to produce one unit of output.

Country Food Clothing Total labor A 3 2 120 B 4 3 240

a. Compute the output per worker of clothing and the output per worker of food in each country. b. Which country has an absolute advantage in clothing, and in food? c. Create a graph of each country's PPF (with food on the y-axis) and indicate the equations defining each frontier. Indicate country B's variables with a superscript *. d. What is the price of clothing, in terms of food, in each country? e. Using the previous answers, what is the pattern of trade? f. Assuming that trade occurs, what do we know about the equilibrium price in free trade? g. Show in a graph that both countries are better off with free trade. h. In which country would you choose to live, that is, in which country can you earn higher real wages?