2. Assume that both the United States and Germany produce beef and computers. The U.S. can

produce 200 computers or 1,000 pounds of beef per day. Germany can produce 500 computers or

250 pounds of beef per day.

(a) What is the opportunity cost of beef and computer chips in each country? In which good does

each country have a comparative advantage? What is the range for mutually beneficial trade

in computers?

(b) Graph the PPCs for each country, putting computers on the horizontal axis. Then identify

the slopes of the PPCs. What does the slope represent?

Answer rating: 100% (QA)

a The opportunity cost of beef in the US is 11000 pounds per computer while the opportunity cost of ... View the full answer