Current output of Agland and Zenland:
Agland Zenland Total
Grain 100 50 150
Incense 20 0 20
Output if specializing in good with comparative advantage:
Agland Zenland Total
Grain 200 0 200 (20 workers x 10 units per worker = 200 units of grain)
Incense 0 150 150 (10 workers x 15 units per worker = 150 units of incense)
Grain 200 0 200 (20 workers x 10 units per worker = 200 units of grain)
Incense 0 150 150 (10 workers x 15 units per worker = 150 units of incense)
Increase due to specialization:
Grain = 200 units - 150 units = 50 units
Incense = 150 units - 20 units = 130 units
Nourhan Y.
05/02/14