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Draw the ppf for the united states

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Suppose in the United States, one worker can produce 10 tons of steel per day or 20 tons of chemicals per day. In the United Kingdom, one worker can produce 5 tons of steel per day or 15 tons of chemicals per day. The United States has 30 workers and the United Kingdom has 20 workers.

  • Draw the PPF for the United States.
  • Suppose the international relative price of a ton of steel is 2.5. Draw the world price line.
  • Show that the United States is better off under trade compared to Autarky with the aid of indifference curves.
  • Show the amount the United States will export and import.
  • What would be the real wage of the workers in the two countries?

Reference no: EM131199652

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