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

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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

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