The figure depicts a country's production possibilities in a pre-trade equilibrium at point X. The scenario assumes the country is rich in the resources primarily used for coal production.When the country engages in trade, you need to determine which statement accurately describes the production shifts within the country:- **A.** Coal output rises and sugar output falls.- **B.** The output of both goods rises.- **C.** The output of both goods declines.- **D.** Sugar output rises and coal output falls.### Graph Explanation:- The graph shows two axes: the horizontal axis represents coal (Qc & Dc) and the vertical axis represents sugar (Qs & Ds).- There is a curved line (possibly a production possibilities frontier) showing the maximum potential output combinations of coal and sugar.- Point X marks the pre-trade equilibrium, where the country produces a certain amount of coal and sugar.- Lines from axes intersect at point X, illustrating changes in production related to potential trade scenarios.When analyzing the impact of trade based on the country's resource abundance and specialization, consider which outputs will increase or decrease.

Equilibrium is the situation in the market when quantity demanded by consumers equals to the…

The figure to the right shows a country in pretrade equilibrium at point X. Suppose this country is abundant in the factor that is used intensively in the production of coal Suppose the country begins to trade. Which of the following statements describes the production changes that will occur inside this country? OA. Coal output rises and sugar output falls. OB. The output of both goods rises. C. The output of both goods declines OD. Sugar output rises and coal output falls. Click to select your answer 10 Sugar Os and Ds Coal Oc & De

The figure to the right shows a country in pretrade equilibrium at point X. Suppose this country is abundant in the factor that is used intensively in the production of coal Suppose the country begins to trade. Which of the following statements describes the production changes that will occur inside this country? OA. Coal output rises and sugar output falls. OB. The output of both goods rises. C. The output of both goods declines OD. Sugar output rises and coal output falls. Click to select your answer 10 Sugar Os and Ds Coal Oc & De

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Poland requires 4 hours of labor to produce 1 ton of coal and 1 hour of labor to produce a bushel of wheat. The Czech Republic requires 6 hours of labor to produce 1 ton of coal and 1 hour of labor to produce a bushel of wheat. Suppose that Poland has 1,000 hours of labor and that it completely specializes according to its comparative advantage. How many units of which product will it produce? 250 tons of coal 1,000 bushels of wheat O100 bushels of wheat 4,000 tons of coal One of the main reasons for China to actively invest in foreign companies is to enhance the competitiveness of Chinese firms globally. take advantage of low wages in foreign countries. Omake best use of its technological expertise in the world market. meet the growing demand of the high population in China.
Suppose that France and Germany both produce wine and cheese. The table below shows combinations of the goods that each country can produce in a day. France Germany Wine (Bottles) Cheese (Pounds) 16 Wine (Bottles) Cheese (Pounds) 12 8. 4. 25 20 15 2 3 3 4 10 4 Who has the comparative advantage in producing wine and who has the comparative advantage in producing cheese? O A. France has a comparative advantage producing wine and Germany has a comparative advantage producing cheese. O B. France has a comparative advantage producing wine and cheese. OC. Germany has a comparative advantage producing wine and cheese. -OD. Neither has a comparative advantage producing wine or cheese. OE. France has a comparative advantage producing cheese and Germany has a comparative advantage producing wine. Suppose that France is currently producing 1 bottle of wine and 12 pounds of cheese and Germany is currently producing 3 bottles of wine and 10 pounds of cheese. Then, assume instead that France and…
COFFEE (Millions of pounds) 48 42 36 30 24 18 12 6 0 PPF 1 Maldonia 36 30 POTATOES (Millions of pounds) 06 12 18 24 42 48 COFFEE (Millions of pounds) 48 42 36 30 24 18 12 6 0 PPF 1 0 6 Lamponia 18 42 12 24 30 36 POTATOES (Millions of pounds) 48 Consider the above two graphs which represent production possibilities. What are the comparative advantages? Maldonia has a comparative advantage in potatoes and Lamponia has a comparative advantage in coffee Maldonia has a comparative advantage in both goods O Lamponia has a comparative advantage in both goods O Maldonia has a comparative advantage in coffee adn Lamponia has a comparative advantage in potatoes
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1. Suppose there are two countries Peru and Japan that produce Food and Fuel. Peru can produce 7,523 units of Food or 17,853 units of Fuel using a labour force of 8000. Japan can produce 5,733 units of Food or 24,156 units of Fuel using a labour force of 5000. a) Which country has the comparative advantage in food? In fuel? Explain. b) Which good(s) should each country specialize in? c) Discuss the benefits of specialization for each country.
↳ A Click Submit to complete this assessment. Question 33 What insights do welfare analysis (consumer surplus/producer surplus) offer into international trade? O a. That trade increases the welfare of producers, so trade may make total surplus fall. O b. That tariffs make a country better off and trade wars can definitely be won! Oc. That nations are better off NOT trading with each other, because lower world prices harm most nations' producers and consumers. Od. That while trade increases total surplus, consumers or producers in a country may gain or lose, depending on world price. A Click Submit to complete this assessment. tab caps lock shift fn 1 Q 2 A W Z I 3 S E X S D R C F T V G H B J N K
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Suppose that France and Italy both produce wine and cheese. France's opportunity cost of producing a case of cheese is 5 barrels of wine, while Italy's opportunity cost of producing a case of cheese is 10 barrels of wine. By comparing the opportunity cost of producing cheese in the two countries, you can tell that comparative advantage in the production of cheese and has a comparative advantage in the production of wine. Suppose that France and Italy consider trading cheese and wine. France can gain from specialization and trade as long as it receives more than of wine for each case of cheese it exports to Italy. Similarly, Italy can gain from trade as long as it receives of cheese for each barrel of wine it exports to France. more than Based on your answer to the last question, a price ratio between benefit both countries. has a barrels of wine per case of cheese will
Refer to Table 1-1 Now, each country spends all 40 hours of its time producing only the good for which it has a comparative advantage. What is the total output of CHEESE produced by both countries combined now?
Consider two neighboring island countries called Bellissima and Dolorium. 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) Bellissima 12 24 Dolorium 8 32 Initially, suppose Bellissima uses 1 million hours of labor per week to produce rye and 3 million hours per week to produce jeans, while Dolorium uses 3 million hours of labor per week to produce rye and 1 million hours per week to produce jeans. Consequently, Bellissima produces 12 million bushels of rye and 72 million pairs of jeans, and Dolorium produces 24 million bushels of rye and 32 million pairs of jeans. Assume there are no other countries willing to trade goods, so, in the absence trade between these two countries, each country consumes the amount of rye and jeans it produces. v of…
Germany can produce either 40 units of pretzels or 20 units of cars per labour hour. Canada can produce either 61 units of pretzels or 14 units of cars per labour hour. Suppose Canada follows its comparative advantage in deciding what to produce and trade with Germany at a trade price of 0.34 units of cars for one unit of pretzel. For every 5050 units of the goods that Canada produces and trades with Germany, what are the gains from trade in terms of the other goods?