Reference no: EM131446284
Produtions and Consumption- This problem illustrates an example of trade induced by comparative advantage. It assumes that China and France each have 1,000 production units. With one unit of production ( a mix of land, labor, capital and technology), China can produce either 18 containers of toys or 8 cases of wine. France can produce either 3 containers of toys or 8 cases of wine. Thus, a production unit in China is six times as efficient compared to France when producing toys, but euqally efficient when producing wine. Assuming at first that no trade takes place. china allocates 750 production units to building toys and 750 production units to producing wine. What is the production and consumption of China and France without trade?
A) What is the production and consumption of China and France without trade?
Calculate the production and consumption of China and France without trade below: (Round to the nearest integer)
Production if there is no trade . Toys
China
Allocated production units to _________
Produces and Consumes __________
France
Allocated production units to __________
Produces and Consumes _________
Total production and consumption across both countries _________
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