In Thailand, 10 workers can each produce 2 computers or 30 tons of rice. In the United States 20 workers can each produce 5 computers or 40 tons of rice
a) Draw the production possibility curve for each country.
b) What is the opportunity cost of computers in Thailand? In the USA?
c) Which country has a comparative advantage in the production of computers? Why?
d) In the absence of trade, if we consume 150 tons of rice in Thailand, how many computers will we be able to consume?
e) In the absence of trade, if we consume 50 tons of computers in the United States, how many tons of rice can we consume?
f) Let's say the United States and Thailand sign a free trade agreement. Under this agreement, the United States gives Thailand 10 computers and Thailand gives the United States 120 tons of rice
If in thailand we continue to consume 150 tons of rice, how many computers will thailand be able to buy
If in the United States we continue to buy 50 computers, how many tons of rice will we be able to consume?
g) Should Thailand accept this agreement?
United States?