The following hypothetical production possibilities tables are for China and the United States. Assume that before specialization and trade the optimal product mix for China is alternative B and for the United States is alternative U Product Apparel Chemicals tons China Production Possibilities A 3 0 30,000 24,000 18,000 12,000 6 12 18 E 6,000 24 30 Product Apparel Chemicals(tons) U.S. Production Possibilities R 1 U 10,000 8,000 6.000 4,0000 0 4 8 12 V 2,000 16 W 0 20 b. What is the total gain in apparel and chemical output that would result from such specialization? Apparel ton(s) units Chemicals c. What are the limits of the terms of trade? 1000 units of apparel for 1 ton of chemicals and units of apparel for 2 tons of chemicals Suppose that the actual terms of trade are 1,000 units of apparel for 12 tons of chemicals and that 4,000 units of apparel are exchanged for 6 tons of chemicals. What are the gains from specialization and trade for each nation? China has a gain of units of apparel The United States has a gain of ton(s) of chemicals