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  3. wh laa answer questions 3 through 6 based on the...

Question: wh laa answer questions 3 through 6 based on the...

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wh. laa Answer questions 3 through 6 based on the following information: There are two countries, Home and Foreign, in a hypothetical world. Each of these two countries are Ricardian economies. Each country is endowed with 100 labor hours. Each country can use labor to produce two goods, cheese and car. The following table shows labor requirements per unit of each good in each country. Perfect competition prevails everywhere in the two-country world. Suppose that w and w represent Homes and Foreigns hourly wage rates, respectively. uctHomeForeign aLY-0.5 Table 1: Labor hours per unit of outputs Cheese (X) aLx2 Car (Y)

7. What is the opportunity cost of producing one unit of cheese in Home? A) 1 car B) 2w C) 2 cars D) w 8. What is the opportunity cost of producing one unit of cheese in Foreign? A) 1 car B) 2w C) 2 cars D) w

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