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Hello! Is this correct? Also, what is the answer for the last two blanks I have (including explanation)? Problem 40-03 (algo) The following hypothetical production
Hello! Is this correct? Also, what is the answer for the last two blanks I have (including explanation)?
Problem 40-03 (algo) The following hypothetical production possibilities tables are for China and the United States. Assume that before specialization and trade the optimal product mix for China is alternative B and for the United States is alternative U. 20,000 16,000 12,000 8,0000 4,000 Chemicalsitons) mum- Instructions: Enter your answers as whole numbers. a. Are comparative-cost conditions such that the two countries should specialize? If so, what product should each produce? China should produce . The United States should produce 0 b. What is the total gain in apparel and chemical output that would result from such specialization? Apparel: units Chemicals: ton(s) c. What are the limits of the terms of trade? 'IOOO units of apparel for 1 ton of chemicals and 1000 units of apparel for 2 tons of chemicals. Suppose that the actual terms of trade are 1,000 units of apparel for 11/2 tons of chemicals and that 8,000 units of apparel are exchanged for 12 tons of chemicals. What are the gains from specialization and trade for each nation? has a gain of|:| units of apparel. The United States has a gain of|:| ton(s) of chemicalsStep by Step Solution
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