1. When country A can produce a good using fewer absolute inputs than any other country, then country A;__ 2. Gain from trade are mainly due to: 3. Because trade increases a nation's consumption possibilities it is clear that: 4. When the terms of trade are between the opportunity cost for two countries the both countries benefit if they:

1. When country A can produce a good using fewer absolute inputs than any other country, then country A;__ 2. Gain from trade are mainly due to: 3. Because trade increases a nation's consumption possibilities it is clear that: 4. When the terms of trade are between the opportunity cost for two countries the both countries benefit if they:

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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1 Assume that Great Britain and the United States can both produce wheat (W) and cloth (C). The amount of wheat and cloth that each nation can produce in one day is presented in the table below. Comparative Advantage Wheat Cloth Great Britain 140 480 United States 1,120 560 Instructions: Round your answers to two decimal places. еВook a. Use the information above to compute the opportunity cost of 1 unit of wheat in each country. For Great Britain, the opportunity cost of producing 1 unit of wheat is 3.42 unit(s) of cloth. Print For the United States, the opportunity cost of producing 1 unit of wheat is 0.5 unit(s) of cloth. b. Use the information above to compute the opportunity cost of producing 1 unit of cloth in each country. References For Great Britain, the opportunity cost of producing 1 unit of cloth is 0.29 unit(s) of wheat. For the United States, the opportunity cost of producing 1 unit of cloth is 2 unit(s) of wheat. c. With mutually beneficial trade, wheat will be exported…
31.If it takes one country one unit of labor to produce either a computer or a TV but it takes the other country three units of labor to produce a computer and four to produce a TV, then the first country has A)a comparative advantage in both goods. B)an absolute advantage in TVs but a comparative advantage in computers. C)an absolute advantage in TVs and computers but a comparative advantage in computers only. D)an absolute advantage in TVs and computers but a comparative advantage in TVs only. 32.If it takes one country two units of labor to produce a computer and three units of labor to produce a TV but it takes the other country three units of labor to produce a computer and four to produce a TV, then the first country has A)a comparative advantage in both goods. B)an absolute advantage in TVs but a comparative advantage in computers. C)an absolute advantage in TVs and computers but a comparative advantage in computers only. D)an absolute advantage in TVs…
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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.
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England and Scotland both produce scones and sweaters. Suppose that an English works can produce 50 scones per hour or 1 sweater per hour. Suppose that a Scottish worker can produce 40 scones per hour or 2 sweaters per hour. a. Which country has the absolute advantage in the production of each good? Which country has the comparative advantage? b. If England and Scotland decide to trade, which commodity will Scotland trade to England? Explain. c. If a Scottish worker could produce only 1 sweater per hour, would Scotland still gain from trade? Would England still gain from trade? Explain.
Perry's Production Possibilities Frontier Jordan's Production Possibilities Frontier ↑m 20- INOW 20- 10- 18. 16 16- 34 14- 12 124 T 1 Figure 3-15 Refer to Figure 3-15. If Perry and Jordan each spends all of his/her time producing the good in which she has a comparative advantage and trade takes place at a price of 1 movel for 7 poems, then Ⓒa. Perry and Jordan will both gain from this trade. O b. Perry will gain from this trade, but Jordan will not. Oc Jordan will gain from this trade, but Perry will not. Od neither Perry nor Jordan will gain from this trade.