Suppose that in an hour a Japanese worker can produce 40 cameras or 8 computers, while a

Malaysian worker can produce 32 cameras or 4 computers. Both the workers work for 5 hours every

day.

a) Which country has an absolute advantage in producing cameras? Which country has an absolute

advantage in producing computers? Explain.

b) Which country has a comparative advantage in producing cameras? Which country has a

comparative advantage in producing computers? Explain.

c) Which country would specialize in which type of product? Would Taiwan be willing to trade 6

cameras for 1 computer? Why or why not?