A Tale of Two Tribes

Worksheet

Engia Vs. Portigia

The following table shows the productivity of Engia and Portigia.

Daily Output
Wood Fish
Engia 80 OR 120
Portigia 200 160

Based on the story told, answer the questions below to find out how the plan suggested by David can improve the living standards of both tribes.
In this case, we have assumed that the individual productivity of workers do not increase as a result of specialization. Furthermore, all fish and
wood is homogeneous.

1. Which tribe is better at collecting wood: Engia or Portigia?

2. Which tribe is better at catching fish: Engia or Portigia?

3. Before the arrival of David, how much wood and fish can the tribes get? Remember that the workers were divided into two halves to perform
each task. Complete the following table with your answers.

1
 Daily Output / goods available
The initial situation
Wood Fish
Engia
and
Portigia
Total and

4. Suppose the chiefs adopt David's plan and assign the tasks to the workers according to his suggestion. How much wood and fish would they
get? Remember that ALL the Engian workers are assigned to catch fish. In Portigia, 15 workers are assigned to collect wood and 5 workers
to catch fish. Complete the following table with your answers.

Daily Output
David's plan
Wood Fish
Engia
and
Portigia
Total and

5. After they have adopted David's plan, do they have more output as a whole? How much additional wood can they collect? How many fish
can they catch?

That is amazing! They are really more productive than before.

6. In order to make them realize the benefit, David arranged an exchange of goods between these two tribes. David asked them to exchange 45

2
 units of wood for 45 units of fish. After the exchange, what quantity of goods is available in each tribe? Complete the table below.

Goods available
After trade
Wood Fish
Engia
and
Portigia
Total

7. Do they really gain from such an arrangement? Compare the table in 3. and 6. and find out the gains from trade. Complete the table below.
Gains from trade
Wood Fish
Engia
and
Portigia

8. Can you explain why they can produce more output with the same amount of resources?