Engineering, 31.01.2021 09:10 ejones123
Sweden production: 80 petroleum Portugal production: 25 petroleum
10 stained glass 10 stained glass
A) Which country has the comparative advantage in the production of stained glass?
B) If Sweden produces 5 panes of glass, and Portugal also produces 5 panes of glass what is the total amount of petroleum and stained glass produced among both countries?
C) If each country specializes in the good in which they have the comparative advantage, what is the total amount of petroleum and stained glass produced among both counties?
D) Suppose Portugal offers Sweden 2 panes of glass for 14 barrels of petroleum, how much better off is Sweden in terms of petroleum as a result of this trade? What is the maximum amount of petroleum that Sweden would be willing to exchange in order to go through with this trade?
Answers: 1
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Sweden production: 80 petroleum Portugal production: 25 petroleum
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