Suppose and produce only cell phones and digital music players. Assume that each country uses only labor to produce each good, and that the cell phones and digital music players made in and are exactly alike. The table below shows how much each country can produce of each good with one hour of labor: Part 2 Output per Hour of Labor Cell Phones Digital Music Players Part 3 Suppose that and do not trade with each other. Each has hours of labor with which to produce cell phones and digital music players, and the countries are currently producing amounts of each good shown in the table below: Part 4 Consumption with Hours of Labor Cell Phones Digital Music Players Part 5 Assume now that each country specializes in producing that good in which it has a comparative advantage. Further, assume for simplicity that one cell phone can be traded for one digital music player. Part 6 If trades cell phones for digital music players with , then, with trade, will be able to consume the same number of digital music players and enter your response here additional cell phones (enter a numeric response using an integer), and will be able to consume the same number of cell phones and enter your response here additional digital music players.

The opportunity cost of producing 1 cell phone for Taiwan is (600/9900) 0.06 digital music players and the opportunity cost of producing 1 digital music player is (9900/600) = 16.5 cell phones.

Germany produces 600 cell phones and 2,660 digital music players. The opportunity cost of producing 1 cell phone is (2,660/600) 4.43 digital music players and the opportunity cost of producing 1 digital music player is (600/2,660)= 0.23 cell phones.

Taiwan can produce cell phones at a lower opportunity cost than Germany. Hence, Taiwan has a comparative advantage in the production of cell phones. It will specialize in the production of cell phones.

In one hour of labor, Taiwan can produce 22 cell phones. Using 500 labor hours (500*22) 11,000 cell phones can be produced. If Taiwan trades 600 cell phones for 600 digital music players then it will be left with 10,400 cell phones.

With trade, Taiwan will be able to consume the same number of digital music players and (10400 - 9900) = 500 additional cell phones.

Learn more about trade on:

https://brainly.com/question/17727564

#SPJ1