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Suppose that in a year, a Canadian worker can produce 100 shirts or 20 computers, while a Chinese worker can produce 100 shirts or 10
Suppose that in a year, a Canadian worker can produce 100 shirts or 20 computers, while a Chinese worker can produce 100 shirts or 10 computers.
a. Does any country have an absolute advantage in producing computers or shirts? Explain your answer. (1 mark)
b. Which country has comparative advantage in producing shirt? Show your steps. (2 marks)
c. Find a meaningful price of shirt after trade which will be mutually beneficial for both countries after trade. Explain your answer. (
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