The nations of Pearland and Mangoland produce pears and mangos. In Pearland, there are 300,000 hours of labor available in a month, and it takes 2 hours of labor to produce a barrel of pears, and 4 hours of labor to produce a crate of mangos. In Mangoland, there are 700,000 hours of labor available in a month, and it takes 1 hour of labor to produce a barrel of pears and 1 hour of labor to produce a crate of mangos. 1. Which country has an absolute advantage in each good?
2. What is the opportunity cost of a crate of mangos in Mangoland?
3. What is the opportunity cost of a crate of mangos in Pearland?
4. Which country has a comparative advantage in each good?
5. Which country should specialize in each good?

Wo firms, a and b, each currently dump 50 tons of chemicals into the local river. the government has decided to reduce the pollution and from now on will require a pollution permit for each ton of pollution dumped into the river. it costs firm a $100 for each ton of pollution that it eliminates before it reaches the river, and it costs firm b $50 for each ton of pollution that it eliminates before it reaches the river. the government gives each firm 20 pollution permits. government officials are not sure whether to allow the firms to buy or sell the pollution permits to each other. what is the total cost of reducing pollution if firms are not allowed to buy and sell pollution permits from each other? what is the total cost of reducing pollution if the firms are allowed to buy and sell permits from each other? a. $3,000; $1,500 b. $4,500; $3,500 c. $4,500; $4,000 d. $4,500; $2,500