1. International trade is beneficial to many people, but not everyone benefits. If the United States lifts all trade restrictions on Sugar, explain who might benefit from this and who might be hurt by these policies.
2. New Zealand and Spain each produce apples and plums. New Zealand can produce a maximum of 60 apples or 15 plums or some combination of both. Spain can produce a maximum of 60 apples or 60 plums or some combination of both. If they decide to specialize and trade, the trade rate is 25 apples for 17 plums.

a. Which nation should specialize in plums and which should specialize in apples?

b. Before trade, New Zealand was producing 20 apples and 10 plums. Before trade, Spain was producing 20 apples and 40 plums. What are the gains to each country from specialization and trade?