Assume that our world consists of only two countries: the United States and the Rest of the World (ROW). Both of these countries produce airplanes and computers. The amounts of each good produced during an hour in each country are provided in the table below.   US ROW Airplanes 5 4 Computers 15 10   Based on this table, who has the absolute advantage in airplanes? ______ In computers? ______ What is the opportunity cost of 1 airplane: in the US? __ _____________ in the ROW? ______________

Essentials of Economics (MindTap Course List)
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ISBN:9781337091992
Author:N. Gregory Mankiw
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Chapter3: Interdependence And The Gains From Trade
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  1. Assume that our world consists of only two countries: the United States and the Rest of the World (ROW). Both of these countries produce airplanes and computers. The amounts of each good produced during an hour in each country are provided in the table below.
 

US

ROW

Airplanes

5

4

Computers

15

10

 

    1. Based on this table, who has the absolute advantage in airplanes? ______

In computers? ______

    1. What is the opportunity cost of 1 airplane:

in the US? __ _____________

in the ROW? ______________

 

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