Nourhan Y.

asked • 05/02/14

What are the steps to be done?

Uzbekistan’s Production Possibilities Frontier Azerbaijan’s Production Possibilities Frontier
 
Without trade, Uzbekistan produced and consumed 12 bolts and 36 nails and
Azerbaijan produced and consumed 14 bolts and 24 nails. Then, each country agreed to specialize in the
production of the good in which it has a comparative advantage and trade 16 bolts for 38 nails. As a result,
Uzbekistan gained
a.2 bolts and 2nails and Azerbaijan gained 2 bolts and 18 nails.
b.4 bolts and 2 nails and Azerbaijan gained 2 bolts and 14 nails.
c.14 bolts and 38 nails and Azerbaijan gained 16 bolts and 42 nails.
d.16 bolts and 38 nails and Azerbaijan gained 16 bolts and 38 nails.
 
 

Nourhan Y.

Unfortunately I can't draw the PPF but I can only mention the boundaries. For Uzbekistan: 30 bolts and 60 nails. For Azerbaijan: 20 bolts and 80 nails
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05/02/14

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