Problem
Assume that there are two countries, Mexico and Brazil, and one product-beer that is produced and consumed in both countries. Before international trade opens between Brazil and Mexico, given the Mexican peso-Brazilian real exchange rate, Mexico's equilibrium price for beer is higher than Brazil's equilibrium price for beer. Explain and show the effects on consumers, producers, and the countries as a whole if we allow them to internationally trade beer (and trading beer has no effect on the exchange rate).