Country A and Country B produce the same two products, hammocks and looms. Country A can produce a maximum of 60 hammock

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Country A And Country B Produce The Same Two Products Hammocks And Looms Country A Can Produce A Maximum Of 60 Hammock 1 (336.89 KiB) Viewed 40 times

Country A and Country B produce the same two products, hammocks and looms. Country A can produce a maximum of 60 hammocks or 40 looms, while Country B can produce a maximum of 40 hammocks or 20 looms. a. What is the opportunity cost to produce a loom in terms of hammocks in Country A? b. Which country, if either, has a comparative advantage in producing looms? Explain. c. Internationally, if 1 loom is traded for 1.75 hammocks, who will benefit from trading: Country A only, Country B only, both countries, or neither country? d. Assume there is international trade. i. Can a country produce beyond its production possibilities curve (PPC)? ii. Can a country consume beyond its PPC?