Complete the following table by determining the opportunity cost of a car and of a ton of grain for both the United States and Japan.Opportunity Cost of1 Car1 Ton of Grain(In terms of tons of grain given up)(In terms of cars given up)United StatesJapanhas an absolute advantageGiven this information,has an absolute advantage in producing cars, andin producing grain.has a comparative advantage inAlso,has a comparative advantage in producing cars, andproducing grain.Assume that without trade, half of each country's workers produce cars and half produce grain.Complete the following table with the quantities of cars produced and consumed in each country if there is no trade.Cars Produced and ConsumedTons of Grain Produced and Consumed(Millions)(Millions)United StatesJapanTrue or False: Both countries would be better off if they produced the good in which they have a comparative advantage and then traded 200 milliontons of grain for 100 million cars. An American worker can produce either 5 cars or 8 tons of grain a year. A Japanese worker can produce either 4 cars or 9 tons of grain a year. To keepthings simple, assume that each country has 100 million workers.Complete the following table with the number of workers needed to make one car or 1 ton of grain in the United States and Japan.Workers Needed to Make1 Car1 Ton of GrainUnited States1/51/8Japan1/41/9

Answered: Image /qna-images/answer/4fef2321-67c6-4d91-9411-a234d181e315.jpg

Complete the following table by determining the opportunity cost of a car and of a ton of grain for both the United States and Japan. Opportunity Cost of 1 Car 1 Ton of Grain (In terms of tons of grain given up) (In terms of cars given up) United States Japan has an absolute advantage Given this information, has an absolute advantage in producing cars, and in producing grain. has a comparative advantage in Also, has a comparative advantage in producing cars, and producing grain.

Complete the following table by determining the opportunity cost of a car and of a ton of grain for both the United States and Japan. Opportunity Cost of 1 Car 1 Ton of Grain (In terms of tons of grain given up) (In terms of cars given up) United States Japan has an absolute advantage Given this information, has an absolute advantage in producing cars, and in producing grain. has a comparative advantage in Also, has a comparative advantage in producing cars, and producing grain.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

The following table shows how many tonnes of dairy products and beef products can be produced in Country 1 and Country 2 with one unit of equivalent resources. Country 1 Country 2 Dairy Products (tonnes) 15 15 Beef Products (tonnes) 5 25 ..... a. Which country has an absolute advantage in dairy products? In beef products? Explain. Whoever is able to produce absolute advantage of producing that product. advantage in dairy production. production. with the same amount of resources has the has the absolute has the absolute advantage in beef A *****
LENTILS (Millions of pounds) 80 70 8 60 50 40 30 20 10 + 0 0 PPF 10 Shenandoah 20 30 40 50 60 PEAS (Millions of pounds) 70 80 (?) LENTILS (Millions of pounds) 80 70 60 50 40 30 PPF 20 10 0 0 T 10 Denali 40 20 30 50 60 PEAS (Millions of pounds) 70 80 (?) Shenandoah has a comparative advantage in the production of , while Denali has a comparative advantage in the production of . Suppose that Shenandoah and Denali specialize in the production of the goods in which each has a comparative advantage. After specialization, the two countries can produce a total of peas. million pounds of lentils and million pounds of Suppose that Shenandoah and Denali agree to trade. Each country focuses its resources on producing only the good in which it has a comparative advantage. The countries decide to exchange 20 million pounds of peas for 20 million pounds of lentils. This ratio of goods is known as the price of trade between Shenandoah and Denali. The following graph shows the same PPF for Shenandoah…
Which country has comparative advantage in the production of food? Explain. See attached.
PRODUCT PER WORKER SOUTH AFRICA NIGERIA TABLES 100 UNITS 40 UNITS CHAIRS 50 UNITS 10 UNITS Calculate the opportunity costs of producing tables in South Africaand in Nigeria. Show your calculations. Which country has an absolute advantage in the production of tables?Justify your answer. Explain which product each of the countries should specialise in andexport. Use the information relating to comparative advantage tosupport your answer.
The concept of comparative advantage is used by both countries and companies. Use a two goods example and two countries or companies to explain the comparative advantage theory. Use this theory to justify if its worthwhile for countries or companies specialize.
COFFEE (Millions of pounds) 48 42 36 30 24 18 12 6 0 PPF 1 Maldonia 36 30 POTATOES (Millions of pounds) 06 12 18 24 42 48 COFFEE (Millions of pounds) 48 42 36 30 24 18 12 6 0 PPF 1 0 6 Lamponia 18 42 12 24 30 36 POTATOES (Millions of pounds) 48 Consider the above two graphs which represent production possibilities. What are the comparative advantages? Maldonia has a comparative advantage in potatoes and Lamponia has a comparative advantage in coffee Maldonia has a comparative advantage in both goods O Lamponia has a comparative advantage in both goods O Maldonia has a comparative advantage in coffee adn Lamponia has a comparative advantage in potatoes
Suppose that Spain and Switzerland both produce oil and cheese. Spain's opportunity cost of producing a pound of cheese is 4 barrels of oil while Switzerland's opportunity cost of producing a pound of cheese is 10 barrels of oil. By comparing the opportunity cost of producing cheese in the two countries, you can tell that has a comparative advantage in the production of cheese and has a comparative advantage in the production of oil. Suppose that Spain and Switzerland consider trading cheese and oil with each other. Spain can gain from specialization and trade as long as it receives more than of oil for each pound of cheese it exports to Switzerland. Similarly, Switzerland can gain from trade as long as it receives more than of cheese for each barrel of oil it exports to Spain. Based on your answer to the last question, which of the following prices of trade (that is, price of cheese in terms of oil) would allow both Switzerland and Spain to gain from…
Estonia Finland One Cell Phone 40 hours 15 hours Lumber (per board foot) 8 hours 4 hours Table 2-5 shows the number of labor hours required to produce a cell phone and a board foot of lumber in Estonia and Finland. Refer to Table 2-5. Does either Estonia or Finland have a comparative advantage and if so, in what product? O Both countries have the comparative advantage in both lumber and cellphones. O Estonia has an comparative advantage in lumber while Finland has the comparative advantage in cellphones. O Finland has an comparative advantage in lumber while Estonia has the comparative advantage in cellphones. O cannot be determined.
Suppose that Cambodia decides to become self-sufficient in bananas and even to export t In order to accomplish this, large tax incentives are granted to companies that will invest in banana production. Soon, the Cambodian industry is competitive and able to sell bananas at the lowest price anywhere. Does Cambodia have a comparative advantage? Why, or why not? What are the consequences for the overall economy?
Two countries, Nicaragua and Argentina can both produce bananas and wheat. Their production possibility frontiers are shown below. Based on this we can say that Nicaragua has a comparative advantage in producing__________. Both countries can gain from trade if Nicaragua produces___________ and Argentina produces __________ and trade. Bananas; bananas; wheat. Bananas; wheat; bananas. Wheat; wheat; bananas Wheat, bananas; bananas
American worker takes 20 hours to produce one computer and 300 hours to produce an RV. A Japanese worker takes 30 hours to produce one computer and 450 Hours to produce an RV. Which country has a comparative advantage in what product? Why?
Suppose that France and Italy both produce wine and cheese. France's opportunity cost of producing a case of cheese is 5 barrels of wine, while Italy's opportunity cost of producing a case of cheese is 10 barrels of wine. By comparing the opportunity cost of producing cheese in the two countries, you can tell that comparative advantage in the production of cheese and has a comparative advantage in the production of wine. Suppose that France and Italy consider trading cheese and wine. France can gain from specialization and trade as long as it receives more than of wine for each case of cheese it exports to Italy. Similarly, Italy can gain from trade as long as it receives of cheese for each barrel of wine it exports to France. more than Based on your answer to the last question, a price ratio between benefit both countries. has a barrels of wine per case of cheese will