Suppose that Ontario and Vermont each produce two goods, maple syrup (M) and hockey sticks (H). The quantities of each good that can be produced by each region in a day are given below:ONTARIO VERMONT GALLONS OF MAPLE SYRUP/DAY 400 1200 HOCKEY STICKS/DAY 200 300 Which region has an absolute advantage in maple syrup production? Which region has an absolute advantage in hockey stick production?Find the opportunity costs of each good for both Ontario and Vermont. c. Should Ontario and Vermont specialize and trade? Which good should be produced by Ontario? Vermont? What are the terms of trade? Use PPCs and CPCs to show that each would be better off through specialization and trade. Of what principle does this question provide an example?

Answer:- Q- Which region has an absolute advantage in maple syrup production? Which region has an…

Answered: Suppose that Ontario and Vermont each…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Suppose that Ontario and Vermont each produce two goods, maple syrup (M) and hockey sticks (H). The quantities of each good that can be produced by each region in a day are given below:

ONTARIO VERMONT

GALLONS OF MAPLE SYRUP/DAY 400 1200

HOCKEY STICKS/DAY 200 300

Which region has an absolute advantage in maple syrup production? Which

region has an absolute advantage in hockey stick production?

Find the opportunity costs of each good for both Ontario and Vermont. c. Should Ontario and Vermont specialize and trade? Which good should be

produced by Ontario? Vermont?

What are the terms of trade? Use PPCs and CPCs to show that each would be

better off through specialization and trade.

Of what principle does this question provide an example?

Definition Video Definition Ability of a country to produce more output with a given level of input or to produce the same level of output with a lower level of input as compared to the other countries. For example, if Country A produces 200 units with the help of 10 units of labor, and Country B produces 300 units with 10 units of labor, Country A has an absolute advantage in the production of the good. Video

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