Two countries trade with each other. The one country (Petro), has a comparativeadvantage i the production of oil; the other (Sucre) in the production of sugar. Both countriesare big on world market for these goods. The world market price of oil is 90 dollars per unit(per barrel): for sugar it is 2 dollars per kg. Evaluate the following statements (each statementseparately), they are true or false? In subtasks 3b and 3c, you must illustrate what happens onthe world market (in task 3a, you must not use any figure).3a With the given relative prices, Sucre's exchange ratio is 90/2, ie 45 kg of sugar perbarrel of oil.33btrade ratio to deteriorate. (Figure required)If Sucre discovers large oil deposits that it can exploit, its time will come3c If a large percentage of the world's population reduces their sugar consumption dueto its harmful health effects improve Petro's metabolic rate. (Figure required)

Comparative advantage is a concept in economics that describes the ability of a country or…

3a With the given relative prices, Sucre's exchange ratio is 90/2, ie 45 kg of sugar per barrel of oil. 3b trade ratio to deteriorate. (Figure required) If Sucre discovers large oil deposits that it can exploit, its time will come 3c If a large percentage of the world's population reduces their sugar consumption due to its harmful health effects improve Petro's metabolic rate. (Figure required)

3a With the given relative prices, Sucre's exchange ratio is 90/2, ie 45 kg of sugar per barrel of oil. 3b trade ratio to deteriorate. (Figure required) If Sucre discovers large oil deposits that it can exploit, its time will come 3c If a large percentage of the world's population reduces their sugar consumption due to its harmful health effects improve Petro's metabolic rate. (Figure required)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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4.
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