1. Mexico and Brazil both produce paper and cement. Suppose that a Brazilian worker can produce 30 tons of paper per hour or 1 ton of cement per hour. While a Mexican worker can produce 15 tons of paper per hour or 3 tons of cement per hour.

a. Which country has the absolute advantage in the production of both goods? Explain.

b. Draw PPF for both countries.

c. Which country has the comparative advantage in cement?

d. Which country has the comparative advantage in paper?

e. If Mexico and Brazil decide to trade, which commodity will Mexico export?