Question

Please help me with econ homework?

2. Suppose that the following table gives recent figures for yield per acre ininois and Kansas: 37 51 42 31 If we assume that farmers in inois and Kansas use the same amount of labor, capital, and fertilizer, which state has an absolute advantage in wheat production and has an absolute advantage in wheat production and (2) has an absolute advantage in soybean production. If we transfer land out of wheat into soybeans, how many bushels of wheat do we give up in Ilinois and in Kansas per additional bushel of soybean production? In linois, an additional bushel of soybean production results in esults in fewer bushels of wheat, and in Kansas, an additional bushel of soybean production fewer bushels of wheat. (Enter your responses rounded to three decimal places) Which state has a comparative advantage in soybean production and in soybean production? has a comparative advantage in soybean production and (4) has a comparative advantage in wheat production The following table gives the distribution of land planted for each state in millions of acres in the same year TILL WHEAT SOYBEANS (83%) 11.8 70% (397%) 1.9 Kansas 20.7 2% Are these data consistent with your answers above? (5) (1) O Kansas (2) Kansas (3) O Kansas 4) O Kansas (5) O No O Illinois linois O Yes

Answer 1

If we assume that farmers in Illinois and Kansas use the same amount of labour, capital and fertilizer-

has an absolute advantage in where production and (2) Illinois has an absolute advantage in production. rightarrow Because Illinois has more per were of production in soy blear and keman has more per were of production in wheat. If we transfer land out of wheat into soybean then In Illinois an additional of soybean production result in 37/42 = 0.880 of wheat and In an additional of soybean production result in 51/32 = 1.645 power of wheat. 3) Illinois has comparative advantage in soybean production advantage and (4) kusas has a cooperation advantage in wheat production 5) yes all these data are with the answers now Illinois has comparative advantage in soybean production Because to produce extra soybean we less amount of wheat in Illinois.