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Nee Top Canvas Google Docs Youtube Com Couses Rent wos 450 book NOTEBOOK 720 answered Close Math Supplement: Why Trade? Homework. Due in 2 days Homework – Unanswered a posh se ment unty 1.2 Production Possibilities F... Consider the attached figure. Assume both countries have the same resources available to them. The darker line shows how many units of goods A and B a worker in the Philippines can produce and the lighter line shows the number of units of goods A and B that a worker in Indonesia can produce. If the two countries specialize in the production of the good in which they have comparative advantage and then trade these goods with each other, would both of them agree to a terms of trade of one unit of Good Afortwo units of Good B? s of volunt at require f type of nos re just as 5 Departme ith 3.2 milli Yes, both would agree for you In Eled. No, Indonesia would not agree with enom No, the Philippines would not agree nployed by bs created Unanswered 2 attempts left Question M16.07 Homework Unanswered MacBook Pro

Answer 1

d) both would agree. because term of trade(TOT) possible only if the two countries accept to each other as exporters and imports. in this situation comparative cost is different for two countries and only one nation has comparative advantage. thus the comparative advantage country export product which has abundant resource available and the other nation can export the product which has comparative advantage in producing any of the different two food and specialise in the production of the good which has better employment of resource with cheap price produce compared with the other good