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Question: assume that home and foreign produce 2 goods highdefinition televisions...

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Assume that Home and Foreign produce 2 goods, High-Definition televisions and kiwi fruit. Use the following information to answer the questions.
a) The Home Country is endowed with 10 workers and has the following marginal products: MPLTV = 2, MPLK = 4. Illustrate the Home country’s PPF, placing televisions on the x-axis. Fully label your graph. (2 pts)







b) The Foreign Country is also endowed with 10 workers and has the following marginal products: MPL*TV =1, MPL*K =3. Illustrate the Foreign country’s PPF, placing televisions on the x-axis. Fully label your graph. (2 pts)
  

c) What is the no-trade relative price of TVs in each country? (2 pts)



  
d) Predict the pattern of trade if the world relative price for televisions is PTV/PK = 2.5. (2 pts)

e) What has happened to the real wage for Home country workers? (Be specific) (2 pts)

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