Suppose that Ireland and Liechtenstein both produce ale and wheat. Ireland's opportunity cost of producing a bushel of wheat is 5 kegs of ale while Liechtenstein's opportunity cost of producing a bushel of wheat is 11 kegs of ale. By comparing the opportunity cost of producing wheat in the two countries, you can tell that Ireland production of wheat and Liechtenstein has a comparative advantage in the production of ale Suppose that Ireland and Liechtenstein consider trading wheat and ale with each other. Ireland can gain from specialization and trade as long as it receives more than 5 kegs of ale for each bushel of wheat it exports to Liechtenstein. Similarly, Liechtenstein can gain from trade as long as it of wheat for each keg of ale it exports to Ireland. receives more than Based on your answ and Ireland to gain 10 kegs o 15 kegs o 1 bushel question, which of the following prices of trade (that is, price of wheat in terms of ale) would allow both Liechtenstein 1/11 bushel eck all that apply. of wheat 1/5 bushel 5 bushels has a comparative advantage in the of wheat 7 kegs of 11 bushels of wheat i 3 kegs of ale per bushel of wheat

Suppose that Ireland and Liechtenstein both produce ale and wheat. Ireland's opportunity cost of producing a bushel of wheat is 5 kegs of ale while Liechtenstein's opportunity cost of producing a bushel of wheat is 11 kegs of ale. By comparing the opportunity cost of producing wheat in the two countries, you can tell that Ireland production of wheat and Liechtenstein has a comparative advantage in the production of ale Suppose that Ireland and Liechtenstein consider trading wheat and ale with each other. Ireland can gain from specialization and trade as long as it receives more than 5 kegs of ale for each bushel of wheat it exports to Liechtenstein. Similarly, Liechtenstein can gain from trade as long as it of wheat for each keg of ale it exports to Ireland. receives more than Based on your answ and Ireland to gain 10 kegs o 15 kegs o 1 bushel question, which of the following prices of trade (that is, price of wheat in terms of ale) would allow both Liechtenstein 1/11 bushel eck all that apply. of wheat 1/5 bushel 5 bushels has a comparative advantage in the of wheat 7 kegs of 11 bushels of wheat i 3 kegs of ale per bushel of wheat

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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