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I2 2. Suppose that Canada and the U.S. both produce maple syrup and honey, which are sold for the same price in both countries. Below
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2. Suppose that Canada and the U.S. both produce maple syrup and honey, which are sold for the same price in both countries. Below are the combinations of the two goods that each country can produce in one day using the same amount of labor and capital. CANADA U.S. Honey (in tons) Maple Syrup (in tons) Honey( in tons) Maple Syrup (in tons) 0 60 0 50 10 45 10 40 20 30 20 30 30 15 30 20 40 0 40 10 50 0a. Which country has a comparative advantage in producing maple syrup? Which country has a comparative advantage in producing honey? b. Suppose that Canada is currently producing 30 tons of honey and 15 tons of maple syrup, and the U.S. is currently producing 10 tons of honey and 40 tons of maple syrup. Demonstrate that Canada and the U.S. can both be better off if they specialize in producing only one good and trade the otherStep by Step Solution
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