E ProblemSetSWZZV'lpdf x + G (D File | C:/Users/sobee/OneDrive/Desktop/Problem%20$et%203%20W2271.pdf 1 of2 9\"C ' \\ Mosllydoudy Q + Q El ED Pageview A\" Readaloud Add texl V Draw v '3 Highlight v Q Erase 2 Heckscher-Ohlin model with Migration Consider the HeckscherOhlin model of trade. Two countries, Argentina and Brazil, produce two goods, Cars (C) and Beer (B), using two factors, Skilled workers (S) and Unskilled workers (U). Skilled workers are those who obtained at least a college degree. There are overall 120 million workers in Brazil, 15% of whom have a college degree. In Argentina there are 25 million workers, 20% of whom have a college degree. Furthermore, suppose that in autarky in Argentina Car producers use 2 Skilled worker and 3 Unskilled workers to produce one car, while Beer producers use 15 Skilled workers and 7 Unskilled workers to produce one barrel of Beer. Please provide explanations for all your answers below. (a) Factor abundance and factor intensity (i) Which country is Skilledlabor abundant and which is Unskilledlabor abundant? (ii) Which sector is Skilledlabor intensive and which is Unskilledlabor intensive? For the reminder of this question you do not need to provide specic numbers, a qualitative answer is suicient. (b) Trade equilibrium (i) Show in a graph similar to Figure 43a from the textbook what the trade equilibrium looks like in each country. Put Cars on the horizontal axis and Beer on the vertical axis. Clearly label the axes, PPF, production point, consumption point, and relevant indifference curves. 1 .'EQL130c_,'.c-:I