The following table shows the output of rice and cotton for Country A and Country B. Each country divides its resources equally between the production of rice and cotton. Based upon the law of comparative advantage, which of the following statement is correct? Units of the output of rice per year Units of the output of cotton per year 500 500 400 200 Country A Country B O a. Country B has a lower opportunity cost in producing rice. O b. Country A should produce both goods as the opportunity cost is the same. O c. Country A has a higher opportunity cost in producing cotton. O d. Country B should produce both goods as they have an absolute advantage.

The following table shows the output of rice and cotton for Country A and Country B. Each country divides its resources equally between the production of rice and cotton. Based upon the law of comparative advantage, which of the following statement is correct? Units of the output of rice per year Units of the output of cotton per year 500 500 400 200 Country A Country B O a. Country B has a lower opportunity cost in producing rice. O b. Country A should produce both goods as the opportunity cost is the same. O c. Country A has a higher opportunity cost in producing cotton. O d. Country B should produce both goods as they have an absolute advantage.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

Suppose that Croatia and Liechtenstein both produce beets and shoes. Croatia's opportunity cost of producing a pair of shoes is 4 bushels of beets while Liechtenstein's opportunity cost of producing a pair of shoes is 12 bushels of beets. 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 beets. has a comparative advantage in the Suppose that Croatia and Liechtenstein consider trading shoes and beets with each other. Croatia can gain from specialization and trade as long as it receives more than of beets for each pair of shoes it exports to Liechtenstein. Similarly, Liechtenstein can gain from trade as long of shoes for each bushel of beets it exports to Croatia. as it 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 beets) would allow both Liechtenstein and Croatia to gain from trade?…
The diagram below shows supply and demand curves for the same good in two countries, A and B. Based on the prices and areas labeled there, Country B P Country A P P3 d P a P D D O The autarky price in Country A is P2. O Country B has a comparative advantage in this good. Moving from autarky to free trade makes suppliers in Country A worse off by the amount a+b. O Moving from autarky to free trade makes demanders in Country B better off by the amount c+d.
help please answer in text form with proper workings and explanation for each and every part and steps with concept and introduction no AI no copy paste remember answer must be in proper format with all working
Suppose that one day of labor in each country produces the following quantities of fish and cheese: 1. Does France have a comparative advantage in the production of fish, cheese, or neither? Explain. 2. Does Japan have a comparative advantage in the production of fish, cheese, or neithter? Explain. 3. Suppose the countries decide to trade with each other—1 ton of cheese for 3 tons of fish. Would this trade be advantageous to both countries? Explain. Country Fish (tons) Cheese (tons) France 80 40 Japan 200 50
Using the numbers in the table, determine which country has a comparative advantage in producing each product. Output per Hour of Work Switzerland Canada Smartphones 8 5 Which of the following statements is true? A. The opportunity cost for Canada to produce one Smartphone is 0.60 Fitness Bracelet. B. The opportunity cost for Switzerland to produce one Fitness Bracelet is 1.25 Smartphones. OC. The opportunity cost for Switzerland to produce one Smartphone is 0.80 Fitness Bracelet. OD. The opportunity for Canada to produce one Smartphone is 1.67 Fitness Bracelets. Fitness Bracelets 10 3
Suppose that France and Germany both produce wine and schnitzel. The table below shows combinations of the goods that each country can produce in a day. France Germany Wine (Bottles) Schnitzel (Pounds) Wine (Bottles) Schnitzel (Pounds) 8 15 1 6 1 12 2 4 2 9 3 3 6 4 4 3 Who has the comparative advantage in producing wine and who has the comparative advantage in producing schnitzel? O A. Germany has a comparative advantage producing wine and schnitzel. O B. France has a comparative advantage producing schnitzel and Germany has a comparative advantage producing wine. O C. France has a comparative advantage producing wine and Germany has a comparative advantage producing schnitzel. O D. France has a comparative advantage producing wine and schnitzel. O E. Neither has a comparative advantage producing wine or schnitzel.
Please choose the answer from the following words and fill in the blanks, each word is not limited to once A. Bananas B. Apples C. 2 D. 0.5
The United States and Canada have the production possibilities curves shown above. It is determined that the United States has the comparative advantage in peanuts. Will both nations gain from trade if the terms of trade that are offered are 1 Peanut= 3 Corn? Why or why not? Show your work.
Solve the problem. Show work and do not use AI
The countries of Sanaton and Microtania each produce two goods: Airplanes and Computers. The table below lists the opportunity costs associated with producing each good, for each country. Country Opportunity cost of producing 1 Airplanes Opportunity cost of producing 1 Computers Sanaton 4 Computers 0.25 Airplanes 2 Airplanes Microtania 0.5 Computers Currently, Sanaton does not trade with Microtania, and on its own produces 19 Airplanes and 24 Computers. On their own, Microtania produces 30 Airplanes and 35 Computers. Calculate total world supply: Airplanes: → Computers: If Sanaton decided to change its production of Airplanes by -2, calculate the change in the production of Computers: If Microtania changed its production of Airplanes by 8, calculate the change in production of Computers: A
Use the information in the table below to answer the following question: Which of the following is true? per unit of Labor: U.S Production Argentina 20 Whe at 300 Beef 100 20 a) The United States has an absolute advantage in the production of Wheat. O b) The United States does not have an absolute advantage in any commodity. c) Argentina has an absolute advantage in the production of Wheat. d) Argentina has an absolute advantage in the production of Beef.
An automobile company has two factories, one in Vietnam and one in Australia, each with the same number of workers. The Vietnamese factory can produce either 150 engines or 100 transmissions per day. The Australian factory can produce either 200 engines or 150 transmissions per day. A. Which factory has an advantage is irrelevant since the theory of comparative advantage only applies to countries, not companies. B. The Australian factory has an comparative advantage in the production of transmissions. C. The Vietnamese factory has an absolute advantage producing both engines and transmissions. D. The Vietnamese factory has a comparative advantage in the production of transmissions.