can produce a maximum of 100 bushels of corn and no oil (point B'). Other combinations of both oil and corn are

possible, such as point C'. All points above the frontiers are impossible to produce given the current level of

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19.1 • Absolute and Comparative Advantage 453

resources and technology.

Arguably Saudi and U.S. consumers desire both oil and corn to live. Let’s say that before trade occurs, both

countries produce and consume at point C or C'. Thus, before trade, the Saudi Arabian economy will devote 60

worker hours to produce oil, as Table 19.3 shows. Given the information in Table 19.1, this choice implies that

it produces/consumes 60 barrels of oil. With the remaining 40 worker hours, since it needs four hours to

produce a bushel of corn, it can produce only 10 bushels. To be at point C', the U.S. economy devotes 40 worker

hours to produce 20 barrels of oil and it can allocate the remaining worker hours to produce 60 bushels of

corn.
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