**Table: Labor Hours Per Unit of Output for Goods in Spain and France**| Goods | Spain | France ||----------|-------|--------|| Grapes | 8 | 15 || Textiles | 4 | 5 |*Note: Figures are hours of labor per unit of output.***Explanation:**The table presents the labor hours required to produce one unit of grapes and textiles in Spain and France. For grapes, it takes 8 hours of labor in Spain and 15 hours in France. For textiles, it takes 4 hours in Spain and 5 hours in France. This comparison suggests differences in labor efficiency between the two countries for these goods. Once trade begins, a possible terms-of-trade for textiles in terms of grapes is _____________ (A: 5; B: 2/5; C: 2; D: 4/5).

Comparative advantage occurs when the nation involved in the trade are not holding an absolute advantage however still gain from trade comparatively. Grapes Textile Spain 8 4 France 15 5 Spain opportunity cost in producing grapes = Quantity of textile / Quantity of grapes = 4 / 8 = 0.5 textile France opportunity cost in producing grapes = Quantity of textile / Quantity of grapes = 5 / 15 = 0.33 textile Because France opportunity cost in producing grapes is low thus has a comparative advantage in producing grapes Terms of trade: For trade to be beneficial for Spain, terms of trade should be less than 0.5 textiles for 1 grape For trade to be beneficial for France, terms of trade should be more than 0.33 textiles for 1 grape 0.3 grapes < Relative price of textile < 0.5 grapes Thus option-b will be the correct answerOption-a will be incorrect. Terms of trade should be between 0.33 and 0.5 Option-c will be incorrect. Terms of trade should be between 0.33 and 0.5 Option-d will be incorrect. Terms of trade should be between 0.33 and 0.5 Option-e will be incorrect. Terms of trade should be between 0.33 and 0.5

Answered: Goods Grapes Textiles Spain 8 4 Note:…

Business

Economics

Goods Grapes Textiles Spain 8 4 Note: figures are hours of labor per unit of output France 15 5

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

2
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
I need help understanding how to solve for this question Worker Wage Time to complete 1 unit Paneling Dry Wall Al ($9/hr) 6hrs 4hrs Ken ($10/hr) 5hrs 5hrs Assuming there are 10 walls to panel (10 paneling jobs) and 8 dry walls to build (8 dry wall jobs) what is the monetary savings if Ken and Al specialize in their respective comparative advantages?
Help
Rank 1 2 3 4 5 6 7 8 9 - 10 Standard of Living Country Qatar Luxembourg Singapore Brunei Kuwait Norway United Arab Emirates San Marino Switzerland â Hong Kong United States The list above shows ♦ Int$ = 132,099 98,987 85,253 79,587 70,166 68,430 67,617 63.104 58,551 56,701 55,805 O Gross Domestic Product, which is the total dollar value of all goods and services produced within a country's borders
7:02 Computers Here There 100 50 a. What is the cost of 1 unit of cloth and a computer in Here? Round your answers below to 2 decimal places. 1 cloth = Cloth 50 90 1 cloth POST or or computers. 1 computer- b. What is the cost of 1 unit of cloth and a computer in There? Round your answers below to 2 decimal places. units of cloth. computers. units of cloth. 1 computer = c. In which product does each country have a comparative advantage? Here: (Click to select) There: (Click to select) ✓ d. What is the range of feasible terms of trade between the two countries? Round your answers below to 2 decimal places. Feasible terms of trade 1 unit of cloth 1 computer between between to to computers units of cloth. Next >
How to make the graphic
5
a. It takes Country A two hours to produce a unit of consumer goods and five hours to produce a unit of capital goods. Country B can produce a unit of consumer goods in one hour and a unit of capital goods in four hours. Which country has a comparative advantage in the production of consumer goods? Explain. b. Country A has the following labor market data: Employed Frictionally unemployed Structurally unemployed Cyclically unemployed 91,000 4,000 2,000 3,000 Not in the labor force, aged 16 years and over 25,000 Calculate the unemployment rate for Country A. c. Calculate the labor force participation rate for Country A. d. Illustrate Country A's current employment of resources every 10 hours on a production possibilities curve with capital goods on the vertical axis and consumer goods on the horizontal axis. Assume constant opportunity costs. Indicate the current employment based on the data from (b) with a point labeled E.
Exit ticket A. Describe two features of today's international division of labor B. Explain one positive effect and one negative effect of the international division of labor for developing o newly industrialized countries C. Identify one change in the economic landscape of the U.S. due to the international division of labor.
Not sure about my answer.
(?) (? Freedonia Desonia 64 64 56 56 48 48 PPF 40 40 32 32 24 PPF 24 16 16 A 8 8 8 16 24 32 40 48 56 64 8 16 24 32 40 48 56 64 LEMONS (Millions of pounds) LEMONS (Millions of pounds) Freedonia has a comparative advantage in the production of while Desonia has a comparative advantage in the production of Suppose that Freedonia and Desonia specialize in the production of the goods in which each has a comparative advantage. After specialization, the two countries can produce a total of million pounds of lemons and million pounds of tea. Suppose that Freedonia and Desonia 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 8 million pounds of lemons for 8 million pounds of tea. This ratio of goods is known as the price of trade between Freedonia and Desonia. TEA (Millions of pounds) TEA (Millions of pounds)