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GarryVolchara [31]
3 years ago
10

Without trade, jake consumes 20 pounds of green beans and 80 punds pf corn and jane consumes 40 pounds of green beans and 40 pou

nds of corn. if the terms of trade are 1 pound of green beans for 3 pounds of corn and jake sells jane 72 pounds of corn after specialization then jane consumes _____ pounds of green beans and ______ pounds of corn
Mathematics
1 answer:
Oksanka [162]3 years ago
4 0

solution:

Terms of trade (TOT) = 1 pound green beans for 3 pound corn.

So, when Jake sells 72 pounds of corn, he buys (72 / 3) = 24 pounds of green beans, which is sold by Jane.

After specialization, Jane produces 80 pounds of green beans and sells 24 pounds out of it.

So, Jane consumes (80 - 24) = 56 pounds of green beans herself.

Also, after specialization, Jane produces only green beans and no corn, so her consumption of corn is equal to the quantity of corn sold by Jake, i.e. 72 pounds.

So, Jane consumes 56 pounds of green beans and 72 pounds of corn.


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