What would be the effect on total? production

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Question - Trade at? France's Domestic Price - 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 8 containers of toys or 6 cases of wine. France can produce either 2 cases of toys or 6 cases of wine.? Thus, a production unit in China is five times as efficient compared to France when producing? toys, but equally efficient when producing wine. Assume at first that no trade takes place. China allocates 800 production units to building toys and 200 production units to producing wine. France allocates 200 production units to building toys and 800 production units to producing wine.

What is the production and consumption of China and France without? trade?

Assume complete? specialization, where China produces only toys and France produces only wine. What would be the effect on total? production?

France's domestic price is 2 containers of toys equals 6 cases of wine. Assume China produces 8,000 containers of toys and exports 400 containers to France. Assume France in turn produces 6,000 cases of wine and exports 1,200 cases to China. What happens to total production and? consumption?

What is the production and consumption of China and France without? trade?

Reference no: EM133036459

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