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Suppose that CAnada and Brazil are trading manufactured goods
and food. The figure shows the Brazilian budget constraint. Given
the axes’ labels, it can be ascertained that the world relative
price of (1 unit of ) manufactured goods is ( ) units of food.
Note that Brazilian food consmption, D BF, is 50 units and its
production of food, Q BF is 70 units. Brazil is thus poised to
export ( ) units of food and import ( ) of manufactured goods