b. What is the total gain in apparel and chemical output that would result from such specialization?Apparel:Chemicals:unitston(s)c. What are the limits of the terms of trade?units of apparel for 1 ton of chemicals andunits of apparel for 2 tons of chemicals.Suppose that the actual terms of trade are 1,000 units of apparel for 1½ tons of chemicals and that 4,000 units of apparel areexchanged for 6 tons of chemicals. What are the gains from specialization and trade for each nation?(Click to select) ✓has a gain ofunits of apparel.(Click to select)✓has a gain ofton(s) of chemicals. The following hypothetical production possibilities tables are for China and the United States. Assume that before specialization andtrade the optimal product mix for China is alternative D and for the United States is alternative S.ProductApparelChemicals (tons)ProductApparelChemicals (tons)(Click to select) ✓China Production PossibilitiesA10,0000unitsB8,00046,0008U.S. Production PossibilitiesRS30,000 24,00006T18,00012ton(s)D4,00012U12,000018E2,00016V6,00024Instructions: Enter your answers as whole numbers.a. Are comparative-cost conditions such that the two countries should specialize?F020W030If so, what product should each produce?China should produce (Click to select)The United States should produce (Click to select) ✓b. What is the total gain in apparel and chemical output that would result from such specialization?Apparel:Chemicals:

Opportunity costs address the potential advantages that an individual, investor, or business passes…

. What is the total gain in apparel and chemical output that would result from such specialization? Apparel: Chemicals: units c. What are the limits of the terms of trade? (Click to select) ton(s) units of apparel for 1 ton of chemicals and units of apparel for 2 tons of chemicals. Suppose that the actual terms of trade are 1,000 units of apparel for 1½ tons of chemicals and that 4,000 units of apparel a exchanged for 6 tons of chemicals. What are the gains from specialization and trade for each nation? has a gain of units of apparel. ✓has a gain of ton(s) of chemicals. (Click to select)

. What is the total gain in apparel and chemical output that would result from such specialization? Apparel: Chemicals: units c. What are the limits of the terms of trade? (Click to select) ton(s) units of apparel for 1 ton of chemicals and units of apparel for 2 tons of chemicals. Suppose that the actual terms of trade are 1,000 units of apparel for 1½ tons of chemicals and that 4,000 units of apparel a exchanged for 6 tons of chemicals. What are the gains from specialization and trade for each nation? has a gain of units of apparel. ✓has a gain of ton(s) of chemicals. (Click to select)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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27. The statement that "if an import tariff raises the relative price of the imported good, the price of the factor used intensively in its production will rise relative to both commodity prices, while the price of the other factor will fall relative to both commodity prices" is called (a) the cancellation axiom (b) the Stolper-Samuelson theorem (c) the law of demand and supply (d) the law of alternatives (e) the principle of comparative advantage oun until on ogui.
In the following table, select the amount of each good that each country exports and Imports In the boxes across the row marked "Trade Action," and enter each country's final consumption of each good on the line marked "Consumption." When the two countries did not specialize, the total production of jeans was 17 million palrs per week, and the total production of rye was 46 million bushels per week. Because of specialization, the total production of jeans has increased by 3 million pairs per week, and the total production of rye has increased by 18 million bushels per week. Because the two countries produce more jeans and more rye under specialization, each country is able to gain from trade. Calculate the gains from trade-that is, the amount by which each country has increased its consumption of each good relative to the first row of the table. In the following table, enter this difference in the boxes across the last row (marked "Increase in Consumption"). Dolorium Arcadia Jeans Rye…
3. Gains from trade Suppose there exist two imaginary countries, Everglades and Yosemite. Their labor forces are each capable of supplying four million hours per day that can be used to produce chinos, pistachios, or some combination of the two. The following table shows the amount of chinos or pistachios that can be produced by one hour of labor. Country Everglades Yosemite Chinos Pistachios (Pairs per hour of labor) (Pounds per hour of labor) 5 20 8 16 Suppose that initially Yosemite uses 1 million hours of labor per day to produce chinos and 3 million hours per day to produce pistachios, while i Everglades uses 3 million hours of labor per day to produce chinos and 1 million hours per day to produce pistachios. As a result, Everglades produces 15 million pairs of chinos and 20 million pounds of pistachios, and Yosemite produces 8 million pairs of chinos and 48 million pounds of pistachios. Assume there are no other countries willing to engage in trade, so, in the absence of trade…
The table below shows the monetary value of the production of gems and steel respectively in the calendar year of 2019 for the nations of Turkey and Zimbabwe. Use It to answer questions regarding a possible trade scenarlo between the two nations. Year- 2019 Gems in billions of USD Steel in billions of USD 0.2 Zimbabwe 10 Turkey Which of the nations has a comparative advantage in the production of steel? O a Zimbabwe O b Nelther Turkey
3. Gains from trade Consider two neighboring island countries called Felicidad and Arcadia. They each have 4 million labor hours available per month that they can use to produce jeans, corn, or a combination of both. The following table shows the amount of jeans or corn that can be produced using 1 hour of labor. Jeans Corn Country (Pairs per hour of labor) (Bushels per hour of labor) Felicidad 5 20 Arcadia 8 16 Initially, suppose Arcadia uses 1 million hours of labor per month to produce jeans and 3 million hours per month to produce corn, while Felicidad uses 3 million hours of labor per month to produce jeans and 1 million hours per month to produce corn. Consequently, Felicidad produces 15 million pairs of jeans and 20 million bushels of corn, and Arcadia produces 8 million pairs of jeans and 48 million bushels of corn. Assume there are no other countries willing to trade goods, so, in the absence of trade between these two countries, each country consumes the amount of jeans and…
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4. Specialization and trade When a country has a comparative advantage in the production of a good, it means that it can produce this good at a lower opportunity cost than its trading partner. Then the country will specialize in the production of this good and trade it for other goods. The following graphs show the production possibilities frontiers (PPFS) for Candonia and Desonia. Both countries produce lemons and tea, each initially (i.e., before specialization and trade) producing 18 million pounds of lemons and 9 million pounds of tea, as indicated by the grey stars marked with the letter A. Candonia Desonia 48 48 42 42 36 36 PPF 30 30 24 24 18 PPF 18 12 12 A 6 6 12 18 24 30 36 42 48 6 12 18 24 30 36 42 48 LEMONS (Millions of pounds) LEMONS (Millions of pounds) Candonia has a comparative advantage in the production of , while Desonia has a comparative advantage in the production of . Suppose that Candonia and Desonia specialize in the production of the goods in which each has a…
5. The price of trade Suppose that Hungary and Norway both produce sunflowers and wheat. Hungary's opportunity cost of producing a bushel of wheat is 6 bushels of sunflowers while Norway's opportunity cost of producing a bushel of wheat is 12 bushels of sunflowers. By comparing the opportunity cost of producing wheat in the two countries, you can tell that production of wheat and has a comparative advantage in the production of sunflowers. Suppose that Hungary and Norway consider trading wheat and sunflowers with each other. Hungary can gain from specialization and trade as long as it receives more than of sunflowers for each bushel of wheat it exports to Norway. Similarly, Norway can gain from trade as long as of wheat for each bushel of sunflowers it exports to Hungary. it receives more than Based on your answer to the last question, which of the following prices of trade (that is, price of wheat in terms of sunflowers) would allow both Norway and Hungary to gain from trade? Check…
5. The price of trade Suppose that Portugal and Sweden both produce fish and olives. Portugal's opportunity cost of producing a crate of olives is 3 pounds of fish while Sweden's opportunity cost of producing a crate of olives is 11 pounds of fish. By comparing the opportunity cost of producing olives in the two countries, you can tell that has a comparative advantage in the production of olives and v has a comparative advantage in the production of fish. Suppose that Portugal and Sweden consider trading olives and fish with each other. Portugal can gain from specialization and trade as long as it receives more than v of fish for each crate of olives it exports to Sweden. Similarly, Sweden can gain from trade as long as it receives more than v of olives for each pound of fish it exports to Portugal. Based on your answer to the last question, which of the following prices of trade (that is, price of olives in terms of fish) would allow both Sweden and Portugal to gain from trade? Check…
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Q58 Suppose Spain is currently producing 90 units of wine and 10 units of cheese, but to produce 10 more units of cheese it must sacrifice 30 units of wine. Further, suppose that Portugal produces 45 units of wine and 45 units of cheese, but to produce 10 more units of cheese it must sacrifice only 10 units of wine. It can be concluded that... a. More information is needed to conclude anything about comparative advantage in either country. b. Portugal has an absolute advantage in wine production and Spain has an absolute advantage in cheese production. c. Spain has a comparative advantage in the production of wine and Portugal has a comparative advantage in the production of cheese. d. Spain has an absolute advantage in both wine and cheese production. e. Portugal has an absolute advantage in both wine and cheese production.
Use the information in the table below to answer the following question: Which of the following is true? per unit of Labor: U.S Production Argentina 20 Whe at 300 Beef 100 20 a) The United States has an absolute advantage in the production of Wheat. O b) The United States does not have an absolute advantage in any commodity. c) Argentina has an absolute advantage in the production of Wheat. d) Argentina has an absolute advantage in the production of Beef.