The Only Two Countries in the World,Alpha and Omega,face the Following

question 33

Essay

The only two countries in the world,Alpha and Omega,face the following production possibilities frontiers.
Alpha's Production Possibilities Frontier Omega's Production Possibilities Frontier

a.
Assume that each country decides to use half of its resources in the production of each good.Show these points on the graphs for each country as point A.
b.
If these countries choose not to trade,what would be the total world production of popcorn and peanuts?
c.
Now suppose that each country decides to specialize in the good in which each has a comparative advantage.By specializing,what is the total world production of each product now?
d.
If each country decides to trade 100 units of popcorn for 100 units of peanuts,show on the graphs the gain each country would receive from trade.Label these points B.

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Definitions:

Behavioral Science

The study of human and animal behavior through the use of observational, experimental, and quantitative methods.

Behavior

Observable actions or responses of an individual or a group that can be directly measured or recorded.

Describe Behavior

To detail or report the actions and reactions of an individual or group, often within a specific context or environment.

Purchasing Patterns

The behavior exhibited by consumers in buying goods or services, including frequency, timing, and choice preferences.