Q.1.16 Japan has a comparative advantage over Germany in the production of cars if it:(1)Is able to produce cars at a faster rate than Germany;(2)Produces cars at a lower opportunity cost than Germany;(3)Has the absolute advantage in car production;(4)Exports more cars than Germany.

Comparative advantage is the advantage in which a country can produce a good relatively cheaper than…

Answered: Japan has a comparative advantage over…

Business

Economics

Japan has a comparative advantage over Germany in the production of cars if it:

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: Explain how each of the alternative models of comparative advantage explains the Leontief Paradox

A: Product cycle model: Frequent modification is required in the production techniques at the stage…

Q: Comparative advantage is a comparison among producers based on opportunity cost. True False

A: Comparative advantage is terms of economics and it is leads to the ability of output or production…

Q: Real world examples of comparative advantage in the Philippines

A: Philippine government policies have historically been anti-agricultural. However, in the 1970s,…

Q: True or false? Free trade causes job losses in industries in which a country does not have a…

A: International trade: - it means the buying and selling of goods and services with other countries.

Q: In Qatar, a worker can produce either one unit of salt or two units of pepper. In Korea, one worker…

A: When a product can be produced at a lower opportunity cost by a country than its other trading…

Q: Assume that you were a small country, what would you rather have a comparative or absolute advantage…

A: Absolute advantage: This concept was introduced by 'Adam Smith' and according to him, international…

Q: Which country has comparative at producing good x. How can you tell. Which country has a comparative…

A: Comparative advantage means that if a country can produce only two goods say computer and clothes if…

Q: Relative to China, in which industries do you think the US has a comparative advantage (in which…

A: US is a developed and one of the most developed economy in the world.

Q: Graphically illustrate and discuss the potential gains from trade for a country with internal…

A: Gains from trade are the net gains that countries can obtain through trading with one another. Trade…

Q: Cars Trucks Mexico 30 20 Canada 24 16 Which country has the Absolute Advantage in…

A: A country has an Absolute advantage in those goods which has country edge in production compare to…

Q: If Nation Z produces donuts at a higher opportunity cost than Nation A, which of the following is…

A: In the given question, it is said that Nation Z produces donuts at a higher opportunity cost than…

Q: A country is the only producer of a particular prescription drug. This country has a comparative…

A: The inquiry concerns the economic principle of comparative advantage, a cornerstone of international…

Q: If a country produces more food and electronics than another country does it have a comparative…

A: Theory of comparative advantage was given by David Ricardo. According to David Ricardo gains from…

Q: The principle of comparative advantage helps explain trade between nations. True False

A: Principle of comparative advantage was given by David Ricardo and it builds on the Principle of…

Q: (? Freedonia Desonia 64 64 56 56 48 PPF 48 40 40 32 32 24 24 PPF 16 16 - --- -- --- 8 8 16 24 32 40…

A: Answer: It is given in the question that: Potatoes Tea Freedonia 32 48 Desonia…

Q: Japan, one worker can make 5 tons of rubber or 30 radios. In Malaysia, one worker can make 4 tons of…

A: An absolute advantage refers to the competitive advantage of a firm when it is able to produce more…

Q: Refer to the figure regarding countries A and B. If each country allocated half of its labor force…

A: Production Production refers to the process at which the goods and services are produced by the…

Q: do you believe that a government setting up tariffs and other restrictions to curb outsourcing is a…

A: Governments establish trade barriers to restrict free trade among economies. Trade barriers are…

Q: What are the sources of Hong Kong's comparative advantage? Explain.

A: Comparative Advantage: The comparative advantage arises when a product is being produced at a lower…

Q: The gravity model allows to directly compare the effect on borders on trade to the effect of…

A: True The given statement is true. The gravity model of international trade is a model that…

Q: China and Thailand jointly produce and efficiently trade tea and noodles. China has a comparative…

A: In the international market, when two countries make a trade transaction on the basis of comparative…

Q: The principle of comparative advantage states that countries should specialize in the production of…

A: International trade is the commercial transactions between countries that take place. Consumer…

Q: According to the theory of Comparative Advantage, participation in international trade will always…

A: The theory of Comparative Advantage is a fundamental concept in economics that explains the benefits…

Q: Who has a comparative advantage at either good x or y

A: Comparative cost advantage: - it is a principle of international trade given by David Ricardo which…

Q: Automobiles Computers…

A: According to the question, it is given that : Automobiles Computers USA 20 15 Germany 15 5…

Q: Corn Sunscreen Mexico 300 150…

A: From the given table, it is concluded that Mexico can produce 300 units of corn by giving up 150…

Q: No written by hand solution Based on information below (2 countries x 2 products), if US has…

A: Comparative Advantage: In the trade theory the country which have comparative advantage in producing…

Q: From an economic point of view, India and China are somewhat similar: Both are huge, low-wage…

A: Terms of trade: It represents the ratio of a country's export prices to its import prices. It…

Q: What is South Koreas' Major exports and foreign investment in the country

A: Exports refers to the amount of goods and services that a nation sells to its trading nations. It is…

Q: Choose four countries. One country in North America, another country in Central America, another…

A: Gravity Model:The gravity model is an economic concept and statistical model used to predict the…

Q: Look at the following table comparing U.S. imports from several countries to capital/labor ratio in…

A: Imports: Imports are foreign goods and products purchased by residents, organizations, and the…

Q: If the United States produces 8 automobiles and Canada produces and Canada produces 2 automobiles,…

A: Comparative advantage is when the country possesses a lower Opportunity cost(OC) in producing a…

Concept explainers

Comparative Advantage and Absolute Advantage Analysis

The theory of absolute advantage was given by Adam Smith in the year 1776.

Question

Q.1.16 Japan has a comparative advantage over Germany in the production of cars if it:
(1)
Is able to produce cars at a faster rate than Germany;
(2)
Produces cars at a lower opportunity cost than Germany;
(3)
Has the absolute advantage in car production;
(4)
Exports more cars than Germany.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1 DEFINITION

VIEW

Step 2 ANSWER

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

France can produce either 50 units or 80 units of wine per labour hour. Canada can produce either 87 units of cheese or 49 units of wine per labour hour. Suppose Canada follows its competitive advantages in deciding what to produce and trade with France at a trade of wine per unit of cheese. For every 3500 units of goods that Canada produces and trades with France, what are the gains from trade in terms of the other goods?
Why does the United States not have an absolute advantage in coffee?
In free trade, the world price of goods directly imported by China is 400 US dollars; the price of the key components of imported goods is 160 dollars. In order to protect domestic production, China has decided to impose 90 % tariff rate on imported goods and 60% tariff rate on key components of the goods. How much is the effective tariff protection rate(ERP) for the goods calculated by two methods respectively?
Suppose that each country decides to specialize in the production of the good un which it has the comparative advantage. by specializing, what is the total world production of the car parts and aircraft parts?
Suppose Country A can produce 200 toys or 400 pineapples per day, while Country B can produce 300 toys or 900 pineapples per day. Where do the comparative advantatges lie? Should trade take place?
Here is what Sweden and Canada can produce: Country Tons of Food Tons of Metal Sweden 40,000 XXXXX Canada XXXXX 1,000 Sweden has a comparative advantage in metal The price of metal will be between 10 and 20 food, if these countries trade. How much metal can Sweden produce? If you think the answer is 17,000, then write 17000, not 17,000.
Hours of work necessary to produce one unit of cloth or wine is shown in the following table: Cloth Wine England 100 120 Portugal 90 80 Who has the comparative advantage in cloth, and who in wine? England, Portugal Portugal, England England, England Portugal, Portugal
Why does australia have a comparative advantage in producing wheat?
Producing socks is labor-intensive, while producing satellites is capital-intensive. If India hasabundant labor, and the U.S. has abundant capital,which good will the U.S. export? Is trade beneficial to textile laborers in the U.S.?
Candonia has a comparative advantage in the production of , while Desonia has a comparative advantage in the production of . Suppose that Candonia 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
With Russia's and Ireland's biggest export, discuss the potential of a comparative advantage, and why the importing country doesn't simply produce that good or service.
Evaluate the following statement: "Canada has an absolute advantage in growing wheat. Therefore, it must have a comparative advantage in growing wheat.