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(Solved): 5. Consider the following table that presents the labour requirements for production in the East a ...



5. Consider the following table that presents the labour requirements for production in the East and West (labour hours ner u

5. Consider the following table that presents the labour requirements for production in the East and West (labour hours ner unit of outnut) Answer the following questions. a. Does the East have an absolute advantage in clothing production? Does the West have an absolute advantage in clothing production? Does the East have an absolute advantage in food production? Does the West have an absolute advantage in clothing production? Explain. (2 marks) b. Does the East have a comparative advantage in clothing production? Does the West have a comparative advantage in clothing production? Does the East have a comparative advantage in food production? Does thas West have a comparative advantage in clothing production? Explain. (2 marks) c. In the West, what is the opportunity cost of producing one more unit of food? In the East, what is the opportunity cost of producing one more unit of food? Explain. (4 marks) d. Under free trade, where should East and West produce food and clothing, so as to maximize the production for these two goods? Explain. (4 marks)


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Intro:Absolute advantage is where a country is more proficient at making an item than another. At the end of the day, it requires less assets to make a last decent or administration. Exp:a. West has an absolute advantage of clothing production than E
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