please give the detailed graph and highlight each answer, thank you!
1. Specialization and trade A country may specialize in the production of a good that it can produce at a lower opportunity cost than its trading partners. Because of this comparative advantage, countries benefit when they specialize and trade with each other. The following graphs show the production possibilities curves (PPCs) for Maldonia and Desonia. Both countries produce grain and tea, each initially (i.e., before specialization and trade) producing 24 million pounds of grain and 12 million pounds of tea, as indicated by the grey stars marked with the letter A. Maldonia Desonia 64 64 56 56 48 48 PPC 40 40 TEA (Millions of pounds) TEA (Millions of pounds) 32 32 24 PPC 24 24, 12 24, 12 16 16 A A CO CO 0 8 16 24 32 40 48 56 64 8 16 24 32 40 48 56 64 GRAIN (Millions of pounds) GRAIN (Millions of pounds)Maldonia has a comparative advantage in the production of , while Desonia has a comparative advantage in the production of . Suppose that Maldonia and Desonia specialize in the production of the goods in which each has a comparative advantage. After specialization, the two countries can produce a total of million pounds of grain and million pounds of tea. Suppose that Maldonia and Desonia agree to trade. Each country focuses its resources on producing only the good in which it has a comparative advantage. The countries decide to exchange 8 million pounds of grain for 8 million pounds of tea. This ratio of goods is sometimes referred to as the terms of trade between two countries. In this case the two countries are Maldonia and Desonia. The following graph shows the same PPC for Maldonia as before, as well as its initial consumption at point A. Place a black point (plus symbol) on the graph to indicate Maldonia's consumption after trade. Note: Dashed drop lines will automatically extend to both axes.The following graph shows the same PFC for Maldonia as before, as well as its initial consumption at point A. Place a black point (plus symbol) on the graph to indicate Maldonia's consumption after trade. Note: Dashed drop lines will automatically extend to both axes. Maldonia Consumption After Trade 32 24 FPS TEA (Millions of pounds) 16 0 3 16 24 32 40 48 56 64 GRAIN (Millions of pounds) The following graph shows the same PPC for Desonia as before, as well as its initial consumption at point A. The following graph shows the same PPC for Desonia as before, as well as its initial consumption at point A. As you did for Maldonia, place a black point (plus symbol) on the following graph to indicate Desonia's consumption after trade. ('3 Desonia 64 56 Consumption After Trade 48 FPS 40 32 24 TEA (Millions of pounds) 16 0 a 16 24 32 40 48 55 64 GRAIN (Millions of pounds) True or False: Without engaging in international trade, Maldonia and Desonia would have been able to consume at the after-trade consumption bundles. (Hint: In answering this question, you may wish to refer to your previous answers.) 0 True 0 False Maldonia has a comparative advantage in the production of V , while Desonia has a comparative advantage in the cialize in the production of the goods in which each has a fi million pounds of grain and E million pounds of production of V . Suppose that M comparative advantage. After specialization, the two countr tea. neither grain nor tea Suppose that Maldonia and Desonia agree to trade. Each co es on producing only the good in which it has a comparative advantage. The countries decide to exchange 8 million pou both grain and tea pounds of tea. This ratio of goods is sometimes referred to as the terms of trade between two countries. In this case the turn . and Desonia. Maldonia has a comparative advantage in the production of V , while Desonia has a comparative advantage in the production of v . Suppose that Maldonia and Desonia specialize in the production of the goods in which each has a comparative - zation, the two countries can produce a total of E million pounds of grain and E million pounds of tea. Suppose that gree to trade. Each country focuses its resources on producing only the good in which it has a comparative neither grain nor tea advantage. T change 8 million pounds of grain for 8 million pounds of tea. This ratio of goods is sometimes referred to as the terms of tra both grain and tea -s. In this case the two countries are Maldonia and Desonia
