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Two countries, Brazil and France, produce two goods, coffee and milk. The technology available to the two countries is repeated in the following table, which

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Two countries, Brazil and France, produce two goods, coffee and milk. The technology available to the two countries is repeated in the following table, which contains the labor productivities in each country. Table 1 Productivity Price Brazil France Milk (in ounces per worker) 9 6 Coffee [in cups per worker) 9 2 France is endowed with six workers. Brazil is endowed with four. Based on the previous Table answer the following three questions: a] Suppose that consumers in Brazil and consumers in France consider it barbaric to consume coffee without milk or to consume milk without coffee. All consumers in each country have identical preferences. The consumer's utility lnction is given by, U = minw. In other wordsI the utility level ofas a society [both for France and Brazil] is given by the minimum of the number of cups of coffee consumed and the number of ounces of milk consumed. Draw the consumer's indifference curve corresponding to a utility level equal to one. b) Draw the autarky equilibrium for each country. How much of each good is consumed in each of the countries? What E the price of coffee and the utility level in each country? c] Suppose the tenns of trade are 2 ounces of milk per cup of coffee. Draw the free trade consumption and production point for each of the two countries. What is the level of imports and exports for Brazil? How about France? How does utility in free trade compare with utility in autarky

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