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The following table defines terms relevant to the basic Ricardian model of one factor and two goods. a Subscript LC = number of labor hours

The following table defines terms relevant to the basic Ricardian model of one factor and two goods. a Subscript LC = number of labor hours needed to produce a unit of candy in Home; a Subscript LW = number of labor hours needed to produce a unit of whiskey in Home; a Subscript LC Superscript star = number of labor hours needed to produce a unit of candy in Foreign; a Subscript LW Superscript star = number of labor hours needed to produce a unit of whiskey in Foreign; Upper P Subscript Upper C = the price per pound of candy on world markets; Upper P Subscript Upper W = the price per gallon of whiskey on world markets. Part 2 Which of the following conditions will induce Foreign to specialize in candy? A. Upper P Subscript Upper C>Upper P Subscript Upper C Superscript star B. (Upper P Subscript Upper C/Upper P Subscript Upper W) > (a Subscript LC Superscript star/a Subscript LW Superscript star) C. Upper P Subscript Upper W Superscript star>Upper P Subscript Upper W D. (Upper P Subscript Upper C/Upper P Subscript Upper W) < (a Subscript LC Superscript star/a Subscript LW Superscript star)

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