Consider two countries, Spain and Norway, that use labour as an input to produce two goods: shoes and tables. . In Spain, one hour of a worker's labour can produce either 5 tables or 10 pairs of shoes. • In Norway, one hour of a worker's labour can produce either 20 tables or 20 pairs of shoes. 1. What is Spain's opportunity cost of producing 1 pair of shoes? 2. What is Norway's opportunity cost of producing 1 table? 3. Using the concept of comparative advantage, which country should produce which good? Give a reason why. 4. Which country has the absolute advantage when producing tables?

Consider two countries, Spain and Norway, that use labour as an input to produce two goods: shoes and tables. . In Spain, one hour of a worker's labour can produce either 5 tables or 10 pairs of shoes. • In Norway, one hour of a worker's labour can produce either 20 tables or 20 pairs of shoes. 1. What is Spain's opportunity cost of producing 1 pair of shoes? 2. What is Norway's opportunity cost of producing 1 table? 3. Using the concept of comparative advantage, which country should produce which good? Give a reason why. 4. Which country has the absolute advantage when producing tables?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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part C D need
Suppose that France and Germany both produce wine and cheese. The table below shows combinations of the goods that each country can produce in a day. France Germany Wine (Bottles) Cheese (Pounds) 16 Wine (Bottles) Cheese (Pounds) 12 8. 4. 25 20 15 2 3 3 4 10 4 Who has the comparative advantage in producing wine and who has the comparative advantage in producing cheese? O A. France has a comparative advantage producing wine and Germany has a comparative advantage producing cheese. O B. France has a comparative advantage producing wine and cheese. OC. Germany has a comparative advantage producing wine and cheese. -OD. Neither has a comparative advantage producing wine or cheese. OE. France has a comparative advantage producing cheese and Germany has a comparative advantage producing wine. Suppose that France is currently producing 1 bottle of wine and 12 pounds of cheese and Germany is currently producing 3 bottles of wine and 10 pounds of cheese. Then, assume instead that France and…
Table 3-6 Denmark Italy Labour hours needed to make 1 unit: Cheese 30 40 Bread 120 160 Refer to Table 3-6. How could Denmark and Italy benefit? Amount produced in 40 hours: Cheese 54 60 by Denmark specializing in bread and Italy specializing in cheese by Denmark specializing in cheese and Italy specializing in bread by Denmark specializing in neither good and Italy specializing in both goods Output is already efficient - there is no way for either country to benefit by Denmark specializing in both goods and Italy specializing in neither good Bread 18 15
Suppose that in the United States, the opportunity cost of producing a motor engine is 4 auto bodies. In Canada, the opportunity cost of producing a motor engine is 2 auto bodies. a. What is the opportunity cost of producing an auto body for the United States? b. What is the opportunity cost of producing an auto body for Canada? c. Which country has a comparative advantage in the production of auto bodies? d. Which country has a comparative advantage in the production of motor engines? Blank 1 Blank 1
SUVs (millions per year) 5 4 3 2 A 2 B ו 3 5 6 Compact cars (millions per year) The figure above shows the production possibilities frontier for a country. In order for it to move from producing at point A to producing at point B, the country would need to: Select one: a. decrease compact car production by 3 million. O b. acquire more resources and/or more advanced technology. C. decrease SUV production by 4 million. d. decrease SUV production by 1 million.
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
1. Analyze the following two countries with linear production technologies and one factor of production. The production technology is given by the following labor requirements: Hot Dogs (labor per unit) Maple Syrup (labor per gallon) USA Canada 1 3 2 1 Each country has 600 hours of labor. a. Which country has the absolute advantage in producing hot dogs? Explain. b. What is the opportunity cost of hot dogs in the US? In Canada? c. Which country has a comparative advantage in each good? Explain. d. What is the range of prices for each good under which both countries will gain from trade? Explain. e. Suppose that the world price of a unit of hot dogs is 1 gallon of maple syrup. Draw a large, clear new graph for each country (put hot dogs on the X axis) showing the autarky equilibrium and the free trade equilibrium (including the trade triangle showing the levels of imports and exports). f. Who gains from free trade in this model? Briefly explain why or why not.
I don't understand the second part of this homework. If Frankie and Johnny completely specialize according to comparative advantage, what will happen to the amount of eggs and milk? I have the opportunity cost calculated to understand who should do what in this case. But what will I do to that number?
part g please
If to produce 1 car Claire experiences an opportunity cost of 15 boots, and Mitch experiences an opportunity cost of 10 boots. Which of the following is true? O Mitch has a comparative advantage in boot production. Mitch has an absolute advantage in boot production. Mitch has an absolute advantage in car production. Mitch has a comparative advantage in car production.
use the following scenario to answer the following quation : an economy has a two workers smith and ricardo. each day theywork .smith can produce 4 computers and 16 smartephone. and ricardo can producce 6 computers and 12 smartphones. (1) the opppertunity cost for smith to produce one computer is ......... smart phones. (a) one quater of (b) one half of (c) one (d) two (e) four
make sure to select all that applies