Country x and country y both produce liters of wine and meters of cloth. in country x each worker in an hour can produce either 10 liters of wine or 30 meters of cloth. in country y each worker in an hour can produce either 5 liters of wine of 25 meters of cloth. each country has constant opportunity cost of production and each has 200 hours of labor available.

initially the two countries do not trade. enter whole number in each blank unless directly to do otherwise.

country x allocates 150 hours of labor to wine production and 50 hours of labor to cloth production so they produce a total of liters of wine and meters of cloth.

country y allocates 75 hours of labor to wine production and 125 hours of labor to cloth production so they produce a total of liters of wine and meters of cloth.

which country has an absolute advantage in producing wine?

which country has a comparative advantage in producing wine?

for the two questions above, enter the letter x or the letter y.

the two countries decide to completely specialize and then engage in trade.

with specialization country x will produce liters of wine and meters of cloth, and country y will produce liters of wine and meters of cloth.

the two countries decide to trade 400 liters of wine in exchange for 1,600 meters of cloth.

after trade country x will consume liters of wine and meters of cloth, and country y will consume liters of wine and meters of cloth.