Question: consider the following ricardian model mpl labor supply pens pencils...
Consider the following Ricardian model.
MPL Labor Supply
France 1/10 1/15 90
Germany 1/12 1/20 120
Answer the following questions and show your steps. For the T/F questions, please explain why they are T/F.
7. Going from closed-economy to free trade, pencil-producing workers in France achieve higher standards of living, but pen-producing workers do not.
8. Under free trade, the pen output of the entire world equals 10 units.
9. If Germany consumes 7 pens under free trade, then France consumes 3 pens.
10. If Germany consumes 7 pens under free trade, then France imports 3 pens.