An average worker in Brazil can produce anounce of soybeans in 20 minutes and an ounceof

Principles of Macroeconomics | 6th Edition | ISBN: 9780538453066 | Authors: N. Gregory Mankiw

Problem 8 Chapter 3

Principles of Macroeconomics | 6th Edition

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Principles of Macroeconomics | 6th Edition | ISBN: 9780538453066 | Authors: N. Gregory Mankiw

Principles of Macroeconomics | 6th Edition

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Problem 8

An average worker in Brazil can produce anounce of soybeans in 20 minutes and an ounceof coffee in 60 minutes, while an average workerin Peru can produce an ounce of soybeans in50 minutes and an ounce of coffee in 75 minutes.a. Who has the absolute advantage in coffee?Explain.b. Who has the comparative advantage in coffee?Explain.c. If the two countries specialize and tradewith each other, who will import coffee?Explain.d. Assume that the two countries trade and thatthe country importing coffee trades 2 ouncesof soybeans for 1 ounce of coffee. Explain whyboth countries will benefit from this trade.

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CHAPTER 1: LEGAL FOUNDATIONS Law is defined as the principles and regulations established in a community by some authority and applicable to its people. The different purposes of law are: to keep social order, to protect people from each other, to provide predictability for individuals and businesses and to control behaviour. The highest law voice in the United States is the Supreme Court....

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Textbook: Principles of Macroeconomics
Edition: 6
Author: N. Gregory Mankiw
ISBN: 9780538453066

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