Consider an economy with two countries and two goods. Unit labor requirement for each product is given in the table below. Apple Domestic 1 Foreign 4 Orange 2 1 Available Labor 1,000 7,000 Suppose that Domestic and Foreign can trade apple in exchange for orange at 1-to-1 ratio. Assume that consumers also prefer consuming at one apple for every orange. Calculate the increase in consumption of orange in Foreign after trade opens. Report your answer in 3-decimal precision. Ex: If your answer is 666.54634654674, then 666.546.

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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Consider an economy with two countries and two goods.
Unit labor requirement for each product is given in the table below.
Domestic
Foreign
Apple
1
4
Orange
2
1
Available
Labor
1,000
7,000
Suppose that Domestic and Foreign can trade apple in exchange for orange at 1-to-1 ratio.
Assume that consumers also prefer consuming at one apple for every orange.
Calculate the increase in consumption of orange in Foreign after trade opens.
Report your answer in 3-decimal precision.
Ex: If your answer is 666.54634654674, then 666.546.
Transcribed Image Text:Consider an economy with two countries and two goods. Unit labor requirement for each product is given in the table below. Domestic Foreign Apple 1 4 Orange 2 1 Available Labor 1,000 7,000 Suppose that Domestic and Foreign can trade apple in exchange for orange at 1-to-1 ratio. Assume that consumers also prefer consuming at one apple for every orange. Calculate the increase in consumption of orange in Foreign after trade opens. Report your answer in 3-decimal precision. Ex: If your answer is 666.54634654674, then 666.546.
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