International Economics,

Chapter 2

Study Guide, Production Scheme

for one unit of alternate commodities i t o Labor

A Ricardian Example of Specialization and Trade Under Assumptions of Constant Costs and Varying Labor Time (productivity differences of Labor across countries)

NOTE: The expression of production of one unit of output of a commodity ito Labor units reflects productivity differences in Labor

Costs per unit in terms of Labor

What is the pattern and direction of trade between the two countries (i.e, England will export ________________ and Portugal______________?

What are the internal costs (prices or opportunity costs in commodities) for both countries and for both commodities?

What are the limits to mutually beneficial trade i t o one unit of wine?