Assume a Ricardian,constant-Cost World The United States Has a Labor Force of 1,000 Workers,and

question 26

Essay

Assume a Ricardian,constant-cost world.There are two countries,the United States and Canada.Each country can produce cameras and milk.The table below shows production per man-hour for each country.
$$\begin{array} { | l | c | c | } \hline & \begin{array} { l } \text { United } \\\text { States }\end{array} & \text { Carada } \\\hline \text { Carneras } & 6 & 2 \\\hline \text { Milk } & 1 & 2 \\\hline\end{array}$$
The United States has a labor force of 1,000 workers,and Canada has a labor force of 500 workers.
a)Use this information to graph production possibilities frontiers for both countries.Put cameras on the horizontal axis.
b)Assuming that a world price is established at which both countries can gain from trade,show possible consumption frontiers for each country.

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Definitions:

Capital Balance

The capital balance in a company's equity section represents the owner's investment, adjusted for withdrawals and profits or losses.

Withdraws

Money taken out from a business by its owners for personal use.

Bonus Distribution

The payout of extra compensation to employees or partners beyond their regular earnings.

Capital

The financial assets or the financial value of assets, such as cash, that are utilized by a company to fund and sustain its operations and growth.