Which country has comparative advantage in the production of washing machines and automobiles? ada can bothchieve mutual gains from trade. If the United Statesproducing pork and sells some of its output to Canada, while Carmon aircraft and sells some of its output to the United States, beconsume more than if they insisted on being self-sufficient. For exStates could trade 1 million tons of pork for 1,500 aircraft from Caallow both countries to consume at a point outside of their producurves.Moreover, these mutual gains don't depend on each countr-producing one kind of good. Even if, say, one country has remaworkers who give it an absolute advantage in both industries, thegains from trade.MODULE 4 REVIEWCheck Your Understanding1. In Italy, an automobile can be produced by 8 workers inone day and a washing machine by 3 workers in one day.In the United States, an automobile can be producedby 6 workers in one day, and a washing machine by2 workers in one day.a. Which country has an absolute advantage in the pro-duction of automobiles? in washing machines?2TACKLE THE AP® TEST: Multiple-Choice-Refer to the graph below to answer questions 1-6 below.Quantity ofwheat (buchola)

Absolute advantage implies or refers to the superior production capabilities in an economy which is…

Answered: 1. In Italy, an automobile can be…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Which country has comparative advantage in the production of washing machines and automobiles?

ada can both
chieve mutual gains from trade. If the United States
producing pork and sells some of its output to Canada, while Carm
on aircraft and sells some of its output to the United States, be
consume more than if they insisted on being self-sufficient. For ex
States could trade 1 million tons of pork for 1,500 aircraft from Ca
allow both countries to consume at a point outside of their produ
curves.
Moreover, these mutual gains don't depend on each countr-
producing one kind of good. Even if, say, one country has rema
workers who give it an absolute advantage in both industries, the
gains from trade.
MODULE 4 REVIEW
Check Your Understanding
1. In Italy, an automobile can be produced by 8 workers in
one day and a washing machine by 3 workers in one day.
In the United States, an automobile can be produced
by 6 workers in one day, and a washing machine by
2 workers in one day.
a. Which country has an absolute advantage in the pro-
duction of automobiles? in washing machines?
2
TACKLE THE AP® TEST: Multiple-Choice-
Refer to the graph below to answer questions 1-6 below.
Quantity of
wheat (buchola)

Definition Video Definition Ability of a country to produce goods and services at a lower opportunity cost compared to other countries. Here, opportunity cost refers to the forgone units of one good in order to produce one more unit of another good. For example, the opportunity cost of producing good X in country A is 2Y and in country B is 1.25Y. Country B has a lower opportunity cost of producing good X than country A. Therefore, country B has a comparative advantage in the production of good X. Video

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