=pnousoModule Two Quiz2. Comparative and absolute advantageVan and Amy are farmers. Each one owns a 12-acre plot of land. The following table shows the amount of barley and alfalfa each farmer can produceper year on a given acre. Each farmer chooses whether to devote all acres to producing barley or alfalfa or to produce barley on some of the land andalfalfa on the rest.BarleyAlfalfa(Bushels per acre)(Bushels per acre)Van408.Amy287On the following graph, use the blue Iline (circle symbol) to plot Van's production possibilities frontier (PPF), and use the purple line (diamond symbol)to plot Amy's PPF.120108Van's PPF9684Amy's PPF72604836ALFALFA (Bushels) 362412120180240300420 480360540600BARLEY (Bushels)has an absolute advantage in the production of barley, andhas an absolute advantage in the production of alfalfa.Van's opportunity cost of producing 1 bushel of alfalfa isbushels of barley, whereas Amy's opportunity cost of producing 1 bushel of alfalfahas a comparative advantage inisbushels of barley. Because Van has aopportunity cost of producing alfalfa than Amy,the production of alfalfa, andN has a comparative advantage in the production of barley.Grade It NowSave & ContinueContinue without savingType here to search

Van has absolute advantage in production of barley. because van can produce 40 bushels per acre…

has an absolute advantage in the production of barley, and has an absolute advantage in the production of alfalfa. Van's opportunity cost of producing 1 bushel of alfalfa is bushels of barley, whereas Amy's opportunity cost of producing 1 bushel of alfalfa opportunity cost of producing alfalfa than Amy, v has a comparative advantage in is bushels of barley. Because Van has a the production of alfalfa, and has a comparative advantage in the production of barley. Grade It Now Save & Continue Continue without saving

has an absolute advantage in the production of barley, and has an absolute advantage in the production of alfalfa. Van's opportunity cost of producing 1 bushel of alfalfa is bushels of barley, whereas Amy's opportunity cost of producing 1 bushel of alfalfa opportunity cost of producing alfalfa than Amy, v has a comparative advantage in is bushels of barley. Because Van has a the production of alfalfa, and has a comparative advantage in the production of barley. Grade It Now Save & Continue Continue without saving

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Chairs Sofas Unskilled Workers 6 4 Skilled Workers 10 6 The first column in the above table above shows how many chairs an unskilled or skilled worker could produce in eight hours. The second column shows how many sofas an unskilled or skilled worker could produce if instead they spent those eight hours producing sofas. According to the data, [ Select ] an absolute advantage in making either type of good. Based on comparative advantage, who should make chairs and who should make sofas? [ Select ] a comparative advantage in making chairs. [ Select] a comparative advantage in making sofas.
QUESTION 9 If Pedro can produce more bread in one day than Roger can produce in one day, then а. Pedro has a comparative advantage in the production of bread. b. Roger has a comparative advantage in the production of bread. C. Pedro has an absolute advantage in the production of bread. d. Roger has an absolute advantage in the production of bread. a d. QUESTION 10 the equilibrium price decreases, and the equilibrium quantity increases the equilibrium price increases, and the effect of quantity is ambiguous the equilibrium price increases, and the equilibrium quantity increases the equilibrium price decreases, and the equilibrium quantity decreases If the demand of soccer balls increases, then a. b. C. d. O a O b O O O O
Bob and Doug spend their workdays making beer and donuts. Bob's Opportunity Cost of producing a unit of donuts is 0.8 units of beer; Doug's Opportunity Cost of producing a unit of donuts is 0.25 units of beer. From this information alone, we know that A. B. C. D. Doug has an Absolute Advantage in the production of donuts and Bob has an Absolute Advantage in the production of beer. Doug has a Comparative Advantage in the production of both donuts and beer. Bob's Opportunity Cost of producing a unit of beer is 1.25 units of donuts and Doug's Opportunity Cost of producing a unit of beer is 4 units of donuts. None of the above answers are correct.
I'm confused on how to calculate the gains from trade. I don't know what to do.
Comparative Advantage: Suppose that the United States and Switzerland produce bicycles and chocolate bars: Bicycles per worker/year Chocolate Bars per worker/year 10,000 20,000 Switzerland 1 United States 5 a. The United States has an absolute advantage in both bicycles and chocolate bars, but which country has a comparative advantage producing bicycles? Chocolate bars? b. Assume there are 10,000 workers. Draw the production possibilities frontier for the United States prior to trade. Assume the two countries agree to exchange 7,000 chocolate bars per bicycle. Illustrate the effect of specialization and trade on the U.S. production possibilities frontier (put bicycles on the x-axis and millions of chocolate bars on the y-axis). c. Assume there are 10,000 workers. Draw the production possibilities frontier for Switzerland prior to trade. Assume the two countries agree to exchange 7,000 chocolate bars per bicycle. Illustrate the effect of specialization and trade on Switzerland's…
21. According to David Ricardo, O A. If countries specialize where they have a comparative advantage and trade, all groups in their economies will benefit equaly OB. If countries specialize where they have a comparative advantage and trade, their efficiency and standard of living can improve O C. If countries specialize where they have an absolute advantage and trade, their efficiency and standard of living can improve O D. Countries should strive to develop their absolute advantage to benefit from trade with other countries
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If France is said to have an absolute advantage over Mexico in the production of wheat, this means that, given the same resources, Mexico must have an absolute advantage in producing some good other than wheat. a. France can produce more wheat than Mexico. b. France has an absolute advantage in all goods that are complements to wheat. c. France must have an absolute advantage over Mexico in producing all goods. d. Mexico must have a comparative advantage over France in the production of wheat.
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ALS ISES V y tools ge Success Tips er Success Tips . SIGN OUT 18 W PPF Shenandoah has a comparative advantage in the production of production of . NNN ALMONDS (Ms of pounds) 3 ****** (spuned to su Shenandoah a comparative advantage. After specialization, the two countries can produce a total of or base Note: Dashed drop lines will automatically extend to both aves. 41 Suppose that Shenandoah and Congaree agree to trade. Each country focuses es resources on producing only the good in which it has a comparative advantage. The countries decide to exchange 8 million pounds of almonds for 8 milion pounds of basil. This ratio of goods is known as the price of trade between Shenandoah and Congaree. The following graph shows the same PPF for Shenandoah as before, as well as its initial consumption at point A. Place a black point (plus symbol)on the graph to indicate Shenandoah's consumption after trade. 16 true 4 False 44 Shenandoah 24 12 ALMONOS (MAons of pounds) 41 40 45 while Congaree has a…
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?