6. The following table describes the production a. For each country, graph the production possibilities of two cities in the country of Baseballia: possibilities frontier. Suppose that without trade the workers in each country spend half their time producing each good. Identify this point in your graphs. b. If these countries were open to trade, which country would export shirts? Give a specific numerical example and show it on your graphs. Which country would benefit from trade? Explain. a. Without trade, what is the price of white socks (in terms of red socks) in Boston? What is the price in Chicago? c. Explain at what price of computers (in terms of shirts) the two countries might trade. Suppose that China catches up with American b. Which city has an absolute advantage in the production of each color sock? Which city has a productivity so that a Chinese worker can comparative advantage in the production of each color sock? If the cities trade with each other, which color soch export? whill each is the range of prices at which mutually beneficial trade can occur? produce 100 shirts or 20 computers in a year. What of trade would you predict now? How does this advance in Chinese productivity affect the economic well-being of the two countries' citizens? citizens? 9. Are the following statements true or false? Explain in each case. 7. A German worker takes 400 hours to produce a car and 2 hours to produce a case of wine. A French a. "Two countries can achieve gains from trade even in the production of all goods." worker takes 600 hours to b. "Certain talented people have a comparative a. For what values of X will gains from trade be advantage in everything they do." possible? Explain. c. "If a certain trade is good for and import wine? Explain. d. "If a certain trade is good for one person, it is 8. Suppose that in a year an American worker can always good for the other one." produce 100 shirts or 20 computers and a Chinese e. "If trade is good for a country, it must be good for everyone in the country." worker can produce 100 shirts or 10 computers.