Microeconomics

The following are hypothetical production possibilities tables for Japan and France. Japan's Production Possibilities Table (Millions of bushels) A B C D Bananas 0 10 20 30 Oranges 120 80 40 0 France's Production Possibilities Table (Millions of bushels) A B C D Bananas 0 30 60 90 Oranges 30 20 10 0 When plotting lines on the graph, select which line you want to plot from the drop down menu at the top of the graph. For each line required, plot any two or more points on the line. a) Plot Japan's production possibilities curve by plotting at least 2 points on the curve. Japan's Production Possibilities Curve Japan's Production Possibilities Curve France's Production Possibilities Curve Japan's Trading Possibilities Curve France's Trading Possibilities Curve 90 75- 60- Bananas (millions of bushels) 45 (0.30) 30 (40,20) 15+ (80,10) PPCJapan (120,0) 40 80 120 160 200 240 280 320 Reset Oranges (millions of bushels) b) Plot France's production possibilities curve by plotting at least 2 points on the curve on the graph above. c) What is each country's cost ratio of producing Oranges and Bananas? Japan : 1 Oranges = 0 Bananas France : 1 Oranges = 3 Bananas d) Which nation should specialize in which product? Japan : Oranges France : Bananas e) Plot Japan's trading possibilities curve (by plotting at least 2 points on the curve) if the actual terms of the trade are 3 oranges for 1 banana f) Plot France's trading possibilities curve (by plotting at least 2 points on the curve) if the actual terms of the trade are 3 oranges for 1 banana. g) Suppose that the optimum product mixes before specialization and trade were B in Japan and B in France. What are the gains from specialization and trade? Oranges : 0 Bananas : 0