This document discusses international trade between the US and Europe. It provides the comparative advantages of each region in producing food and clothing. It then shows the calculations for the goods and labor hours gained from trade using both long and short-cut methods. Specifically, it finds that with the given terms of trade, the US gains 1/6 clothing for each food exported, and 1/2 hour is saved for every 3/2 foods exported. Europe gains 1/3 hours saved for every 2/3 clothing exported. The document cautions that negative answers in the long method do not necessarily mean the solution is correct.

1. INTERNATIONAL TRADE Thereforeeeee...
Given (DTOT): 4/3 C (after trade) – 1C (before trade) = 1/3 C gained for every 2F
US  1 F = 1 lh = 1/2 C (COMPARATIVE ADVANTAGE) exported!
1 C = 2 lh = 2 F
Europe  1 F = 3 lh = 3/4 C Europe  1F + 1C (Before Trade)
1 C = 4 lh = 4/3 F (COMPARATIVE ADVANTAGE) ¾ C + 1C (to be exported)
9/8F + 1C (IMPORTED; After Trade)
ITOT US gds US lh Europe gds Europe lh
1 F = 2/3 C 1/3 C ∀ 2 F ½ lh saved 1/8 F ∀ ¾ C ½ lh saved Thereforeeeee...
∀ 3/2F ∀ 1C
1F=1C 1C∀2F 1 lh saved ∀ -1/4 F ∀ ¾ 1 lh lost ∀ 9/8F (after trade) – 1F (before trade) = 1/8 F gained for every ¾ C
1F C 1C exported!
1 F = 1/4 C -1/2 C ∀ 2 F 2 lh lost ∀ 2F∀¾C 2 lh saved ∀
4F ¼C How to solve for labor hours: (LONG METHOD)
1 F = 3/4 C 1/2 C ∀ 2 F 2/3 lh saved Ø Ø
Given the same DTOT and ITOT:
∀ 4/3 F
1 F = 1/2 C Ø Ø 1/2 F ∀ ¾ C 1 lh saved ∀
½C US  1F + 1C (Before Trade) = 3 hours
1 F = 2/5 C -1/5 C ∀ 2 F ½ lh lost ∀ 7/8 F ∀ ¾ C 7/5 lh saved 1F + 3/2 F (use ITOT)
5/2 F ∀ 2/5 C 1 lh + 3/2 lh (After trade) = 5/2 hours
1 F = 4/7 C 1/7 C ∀ 2 F ¼ lh saved 5/16 F ∀ ¾ 5/4 lh saved
∀ 7/4 F C ∀1C Thereforeeeee…
3 hours (before trade) – 5/2 hours (after trade) = ½ hour saved for every
**OMG WAIT HEHE CAN SOMEONE RECHECK THE GIVEN AND 3/2 F exported!
ANSWERS!!! I JUST GOT THAT FROM SOMEWHERE YEAAAAH LABYU
ALL** Europe  1F + 1C (Before Trade) = 7 hours
2/3 C + 1C (use ITOT)
How to solve for goods: (LONG METHOD) 8/3 lh + 4 lh (After Trade) =20/3 hours
For example: Given the DTOT stated above and ITOT 1F = 2/3 C
Thereforeeeee…
US  1C + 1F (Before Trade) 7 hours (before trade) – 20/3 hours (after trade) = 1/3 hours saved for
2F + 1F (to be exported) every 2/3 C exported!
4/3 C + 1F (IMPORTED; After Trade)

2. How to solve for goods: (SHORTCUT METHOD)
Given the same DTOT and ITOT:
US  ITOT – DTOT = clothers per food
 (1F = 2/3 C) – (1F = ½ C) = 1/6 clothes per food exported
How to solve for labor hours: (SHORTCUT METHOD)
 Make it like parang stoichiometry lang, y’know
 Uhuh, uhuh!! Dimensional Analysis omg soooo freaking fetch!
Given the answer above (1/6 clothes per food exported):
1 clothing x _2 hours_ = _1 hour_
6 food clothing 3 food
ALWAYS REMEMBER aka CAUTION WHEN SOLVING FOR THE LABOR
HOURS!!!!
 When using the Long Method, a negative answer does not mean
that the answer is right! Because it means that it’s wrong
hahahahaha because yeah hirap i-explain dito Facebook
message nalang
 However, when using the Shortcut Method, a negative answer is
always right! YEAH!!!!
** Kaya niyo na isolve yung sa Europe, tinatamad na me omg!!! THE
BUZZ NA EH HEHEHEHEHEHEHE **