Question 20 (Table) The table shows coffee and tea units produced for the United States and Japan. If Japan decides to increase production of tea from 20 units to 35 units, the opportunity cost s: United States Coffee 25 20 15 10 6 5 8 Tea 4 10 Japan 58 38 25 Coffee Tea 15 7 0 3 10 20 35 60 O A. 15 units of tea. B. 10 units of tea. C. 10 units of coffee. O D.8 units of coffee.

Question 20 (Table) The table shows coffee and tea units produced for the United States and Japan. If Japan decides to increase production of tea from 20 units to 35 units, the opportunity cost s: United States Coffee 25 20 15 10 6 5 8 Tea 4 10 Japan 58 38 25 Coffee Tea 15 7 0 3 10 20 35 60 O A. 15 units of tea. B. 10 units of tea. C. 10 units of coffee. O D.8 units of coffee.

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter3: Interdependence And The Gains From Trade

Section: Chapter Questions

Problem 5PA

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Question 26
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QUESTION 7 65+ 60+ 55 50 45 40 282828 35+ 30 25 20 15 10 5+ Cay China's PPF + 5 10 15 20 25 30 35 40 45 50 55 Computer OA. 40 cars and 20 computers B. 40 cars and zero computers C. 20 cars and 20 computers 个 Cor 65+ 60- 55 50+ 45+ Refer to figures above. Suppose that China and Japan fully specialize in the goods in which they have a comparative advantage. Trade is then initiated between the two countries and 20 units of cars are exchanged for 20 units of computers. How many units of cars and computers will China be able to consume after trade? D.40 cars and 40 computers 40- 35+ 30 25- 20 15 10- 5 Japan's PPF 5 10 15 20 25 30 35 40 45 50 55 60 Computer
5. The price of trade Suppose that Portugal and Denmark both produce jeans and cheese. Portugal's opportunity cost of producing a pound of cheese is 4 pairs of jeans while Denmark's opportunity cost of producing a pound of cheese is 10 pairs of jeans. By comparing the opportunity cost of producing cheese in the two countries, you can tell that production of cheese and has a comparative advantage in the production of jeans. has a comparative advantage in the Suppose that Portugal and Denmark consider trading cheese and jeans with each other. Portugal can gain from specialization and trade as long as it receives more than of jeans for each pound of cheese it exports to Denmark. Similarly, Denmark can gain from trade as long as it of cheese for each pair of jeans it exports to Portugal. receives more than Based on your answer to the last question, which of the following prices of trade (that is, price of cheese in terms of jeans) would allow both Denmark and Portugal to gain from trade?…
5. The price of trade Suppose that Hungary and Luxembourg both produce boots and wheat. Hungary's opportunity cost of producing a bushel of wheat is 5 pairs of boots while Luxembourg's opportunity cost of producing a bushel of wheat is 9 pairs of boots. By comparing the opportunity cost of producing wheat in the two countries, you can tell that production of wheat and has a comparative advantage in the production of boots. has a comparative advantage in the Suppose that Hungary and Luxembourg consider trading wheat and boots with each other. Hungary can gain from specialization and trade as long as it receives more than of boots for each bushel of wheat it exports to Luxembourg. Similarly, Luxembourg can gain from trade as long as it of wheat for each pair of boots it exports to Hungary. receives more than Based on your answer to the last question, which of the following prices of trade (that is, price of wheat in terms of boots) would allow both Luxembourg and Hungary to gain from…
5. The price of trade Suppose that Poland and Liechtenstein both produce ale and shoes. Poland's opportunity cost of producing a pair of shoes is 5 kegs of ale while Liechtenstein's opportunity cost of producing a pair of shoes is 12 kegs of ale. By comparing the opportunity cost of producing shoes in the two countries, you can tell that production of shoes and has a comparative advantage in the production of ale. has a comparative advantage in the Suppose that Poland and Liechtenstein consider trading shoes and ale with each other. Poland can gain from specialization and trade as long as it receives more than of ale for each pair of shoes it exports to Liechtenstein. Similarly, Liechtenstein can gain from trade as long as it of shoes for each keg of ale it exports to Poland. receives more than Based on your answer to the last question, which of the following prices of trade (that is, price of shoes in terms of ale) would allow both Liechtenstein and Poland to gain from trade? Check…
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4. Comparative advantage and gains from trade Consider two neighboring island countries called Contente and Euphoria. They each have 4 million labor hours available per week that they can use to produce rye, jeans, or a combination of both. The following table shows the amount of rye or jeans that can be produced using 1 hour of labor. Rye Jeans Country (Bushels per hour of labor) (Pairs per hour of labor) Contente 8 16 Euphoria 5 20 Initially, suppose Contente uses 1 million hours of labor per week to produce rye and 3 million hours per week to produce jeans, while Euphoria uses 3 million hours of labor per week to produce rye and 1 million hours per week to produce jeans. Consequently, Contente produces 8 million bushels of rye and 48 million pairs of jeans, and Euphoria produces 15 million bushels of rye and 20 million pairs of jeans. Assume there are no other countries willing to trade goods, so in the absence of trade between these two countries, each country consumes the amount…
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1. Gains from trade Consider two neighboring island countries called Dolorium and Contente. They each have 4 million labor hours available per week that they can use to produce jeans, rye, or a combination of both. The following table shows the amount of jeans or rye that can be produced using 1 hour of labor. Country Dolorium Contente Jeans Rye (Pairs per hour of labor) (Bushels per hour of labor) 20 16 Initially, suppose Contente uses 1 million hours of labor per week to produce jeans and 3 million hours per week to produce rye, while Dolorium uses 3 million hours of labor per week to produce jeans and 1 million hours per week to produce rye. Consequently, Dolorium produces 15 million pairs of jeans and 20 million bushels of rye, and Contente produces 8 million pairs of jeans and 48 million bushels of rye. Assume there are no other countries willing to trade goods, so, in the absence of trade between these two countries, each country consumes the amount of jeans and rye it produces.…
3. Absolute and comparative advantage Consider two neighboring island countries, Charisma and Fiatstan. Each has 72,000 labor hours available per week that it can use to produce corn, jeans, or a combination of both. The following table shows the amount of labor hours required to produce 1 bushel of corn or 1 pair of jeans. Corn Jeans Country (Labor hours per bushel) (Labor hours per pair) Charisma 80 16 Fiatstan 24 12 has an absolute advantage in the production of corn, and has an absolute advantage in the production Neither country harisma uses 54,000 hours of labor per week to produce corn and 18,000 hours per week to produce jeans, while Fiatstan uses por per week to produce corn and 54,000 hours per week to produce jeans. Assume there are no other countries willing to trade sence of trade between these two countries, each country consumes the amount of corn and jeans it produces. Charisma Fiatstan
3. Absolute and comparative advantage Consider two neighboring island countries, Charisma and Fiatstan. Each has 72,000 labor hours available per week that it can use to produce corn, jeans, or a combination of both. The following table shows the amount of labor hours required to produce 1 bushel of corn or 1 pair of jeans. Corn Jeans Country (Labor hours per bushel) (Labor hours per pair) Charisma 80 16 Fiatstan 24 12 has an absolute advantage in the production of corn, and has an absolute advantage in the production of jeans. Initially, suppose Charisma uses 54,000 hours of labor per week to produce corn and 18,000 hours per week to produce jeans, while Fiatstan uses 18,000 hours of labor per week to produce corn and 54,000 hours per week to produce jeans. Assume there are no other countries willing to trade goods, so in the absence of trade between these two countries, each country consumes the amount of com and jeans it produces. Charisma's opportunity cost of producing 1 bushel of…