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Hi! Please answer the following questions on the images below. Thank you! Question 2. Suppose the international price for these two goods (the Terms of

Hi! Please answer the following questions on the images below. Thank you!

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Question 2. Suppose the international price for these two goods (the Terms of Trade) is 30. This means that 30 units of cloth trade for 1 ton of food. A. Plot the consumption possibilities curve for country A (use the original graph in question 1E. B. Would this country be better off or worse off? Explain. C. Plot the consumption possibilities curve for country B (use the original graph in question 1F. D. Would this country be better off or worse o'? Explain. Question 3. Suppose the international price (Terms of Trade) is now 40. This means that 40 units of cloth trade for 1 ton of food. A. Would these countries want to trade? Explain Suppose two countries produce clothing and food. Country A has five units of labor. It can produce 40 units if cloth with one unit of labor. Country A can produce 2 ton of food with one unit of labor. Country B also has five units of labor. It can produce 36 cloth with one unit of labor and 1 ton of food with one unit of labor. Question 1. Show all your work. A. Which country has an absolute advantage in the production of cloth? B. Which country has an absolute advantage in the production of food? C. Which country has a comparative advantage in the production of cloth? D. Which country has a comparative advantage in the production of food? E. Plot the production Possibilities curve for country A. F. Plot the production Possibilities curve for country B. Country A Country B Cloth Cloth Food Food

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