I need help finding Consumption Comparative Advantage Proble

I need help finding Consumption

Comparative Advantage Problem illustrate an example of trade induced by comparative advantage. They assume that China and France each have 1,000 production units. With one unit of production (a mix of land, labor, capital, and technology),China can produce either 10 containers of toys or 7 cases of wine. France can produce either 2 cases of toys or 7 cases of wine. Thus, a production unit in China is five times as efficient compared to France when producing toys, but equally efficient when producing wine. Assume at first that no trade takes place. China allocates 800 production units to building toys and 200 production units to producing wine. France allocates 200 production units to building toys and 800 production units to producing wine. Production and Consumption. What is the production and consumption of China and France without trade?

Solution

China can produce 10 containers of toys or 7 cases of wine using 1 production unit. China puts 800 production units for the production of toys and 200 production units for the production of wine. So, China can produce and consume 800 * 10 = 800 containers of toys and 200 * 7 = 1400 cases of wine.

France can produce 2 containers of toys or 7 cases of wine using 1 production unit. France puts 200 production units for the production of toys and 800 production units for the production of wine. So, France can produce and consume 200 * 2 = 400 containers of toys and 800 * 7 = 5600 cases of wine.