EBK PRINCIPLES OF MICROECONOMICS
12th Edition
ISBN: 9780134069180
Author: Oster
Publisher: YUZU
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Question
Chapter 2, Problem 1.6P
Subpart (a)
To determine
Which country has
Subpart (b)
To determine
Which country has
Subpart (c)
To determine
Subpart (d)
To determine
Allocation of workers.
Subpart (e)
To determine
Occurrence of trade.
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16
Suppose country A and B have a labour force of 1 and produce hops and barley using only labour. Country A's unit labour cost are 0.5 for hops and 0.5 for barley, country B's 0.2 for hops and 0.4 for barley. Suppose that both are needed to brew beer in equal quantitiy, so that both national and international demand has the property that equal amounts of barley and hops are demanded. How much more beer (as a percentage) will be brewed under international trade than in autarky?
Please enter the percentage rounded to a whole number (up or down is both acceptable) without the percentage sign.
Turkey
Greece
Olives
7.
Taxtilea
The numbers in the table above represent the number of labor hours it will take to produce one unit of the gren pod.
Based on the table above, if complete specialization occurs and Greece has a labor force of 56,000 hours of labor, then after trade begins, k will produce
O a. 7,000 units of olives
O b. 7,000 units of textiles
Oc. 14,000 units of olives or 16,000 units of textiles
O d. 8,000 units of olives
Chapter 2 Solutions
EBK PRINCIPLES OF MICROECONOMICS
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