Chile and the ricardian model assume that chile can produce two goods: manufactures and copper. the technology to produce manufactures and copper both only use labor and they have constant marginal products of labor. the marginal product of labor in manufactures is 5. the marginal product of labor in copper production is 10. and the total quantity of labor in the economy is 100 units. furthermore, assume that chile is a “small open economy”, that is it takes world prices as given and chile has no impact on international supplies and prices.
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