Advanced Placement (AP), 07.09.2020 06:01 jasmine3051
In the following table, enter each country's production decision on the third row of the table (marked “Production”). Suppose the country that produces jeans trades 18 million pairs of jeans to the other country in exchange for 54 million bushels of corn. In the following table, select the amount of each good that each country exports and imports in the boxes across the row marked “Trade Action,” and enter each country's final consumption of each good on the line marked “Consumption.” When the two countries did not specialize, the total production of jeans was 23 million pairs per month, and the total production of corn was 68 million bushels per month. Because of specialization, the total production of jeans has increased by million pairs per month, and the total production of corn has increased by million bushels per month. Because the two countries produce more jeans and more corn under specialization, each country is able to gain from trade. Calculate the gains from trade—that is, the amount by which each country has increased its consumption of each good relative to the first row of the table. In the following table, enter this difference in the boxes across the last row (marked “Increase in Consumption”). Contente Dolorium Jeans Corn Jeans Corn (Millions of pairs) (Millions of bushels) (Millions of pairs) (Millions of bushels) Without Trade Production 8 48 15 20 Consumption 8 48 15 20 With Trade Production Trade action Consumption Gains from Trade Increase in Consumption
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In the following table, enter each country's production decision on the third row of the table (mark...
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