I want to know exactly where these two numbers came from ? I circled them with r

Question

I want to know exactly where these two numbers came from ? I circled them with red

Mmo ? Microsoft x a.capluginfile.php/105895 2/mod-resource/content/1/Lecture%206.pdf D el The Coase M Econ 201 × , Google Tr ×? ? Course Er x 1 Microsoft Th Stort Ans × ECON 20' x ? 1 Fourth Edi × Ì Fourth Edi ' Lecture10 × Microsoft ?egg Stu c CSecure httpsu -Toshibe a nttp://feed helpert. G Google Islas G .JM> J?? d b10 D .ch dul?? LS maintenance engin -English Engi htais, Regina Use monitor in a se. E Dictionary.com i Fi G ProQu tu. " w Microsoft PowerPoint Lecture 7.ppt [Compatibility Mode) Solved Problem 7.3 Gains from Trade Solving the Problem Step 1: Review the chapter material Step 2: Answer part a. by determining which country has an absolute advantage The first table in the problem shows that Portugal can produce more cloth and more wine with one year's worth of labour than England can. Thus, Portugal has an absolute advantage in the production of both goods and England has an absolute advantage in the production of neither Step 3: Answer part b. by determining which country has a comparative advantage To produce 100 sheets of cloth, Portugal must give up producing 150 kegs of wine Therefore, the opportunity cost to Portugal of producing 1 sheet of cloth is 150/100, or 1.5 kegs of wine. England has to give up producing 60 kegs of wine to produce 90 sheets of cloth, so its opportunity cost of producing 1 sheet of cloth is 60/90, or 0.67 keg of wine Opportunity Costs Portugal England Cloth 1.5 kegs of wine 0.67 keg of wine Wine 0.67 sheet of cloth 1.5 sheets of cloth Portugal has a comparative advantage in wine because its opportunity cost is lower England has a comparative advantage in cloth because its opportunity cost is lower Copvight 2015 Pearson Canada Inc

Explanation / Answer

Solution:

To produce 100 sheets of cloth Portugal must give up 150 kegs of wine = 100 * 150 = 15,000

England = 60 * 150 = 9000; or 90*100 = 9000

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