Microsoft Word – Homework1.docxProblem 2 (40 points) Suppose the US and Japan have the following production possibility tables (final output combinations):JapanUnited StatesBolts of ClothTons of WheatBolts of ClothTons of Wheat100005000800100400200600200300400400300200600200400100800050001000100005000a. Draw each countryâs production possibility curve.b. In what good does the United States have a comparative advantage? What about Japan?c. Is there a possible trade that benefits both countries? If there are several such possible situations, please discuss ONLY one.d. Please demonstrate your answer to point c above graphically (be sure to properly label your graph).
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