Under free trade, advantage is the reason for positive gains to both economies, whereas under free migration, advantage is the reason for positive gains. Ocomparative; comparative absolute; absolute O comparative; absolute absolute; comparative O comparative; relative
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- Table 33.15 shows how the average costs of production for semiconductors (the chips In computer memories) change as the quantity of semiconductors built at that factory increases. Based on these data, sketch a curve with quantity produced on the horizontal axis and average cost of production on the vertical axis. How does the curve illustrate economies of scale? If the equilibrium quantity of semiconductors demanded is 90,000, can this economy take full advantage of economies of scale? What about if quantity demanded is 70,000 semiconductors? 50,000 semiconductors? 30,000 semiconductors? Explain how international trade could make it possible for even a small economy to take full advantage of economies of scale, while also benefiting from competition and the variety offered by several producers.Canada exports canola oil to Japan. Therefore, Japan must have the comparative advantage in the production of canola oil, and its autarkic price is higher than the free trade price. O Japan must have the comparative advantage in the production of canola oil, and its autarkic price is lower than the free trade price. Canada must have the comparative advantage in the production of canola oil, and its autarkic price is higher than the free trade price. Canada must have the comparative advantage in the production of canola oil, and its autarkic price is lower than the free trade price.Assume that England and Spain can switch between producing cheese and producing bread at a constant rate. Labor Hours Needed Number of Units to Make 1 Unit of Produced in 40 Hours Cheese Bread Cheese Bread England 1 40 10 Spain 10 England has a comparative advantage in the production of O a. cheese and Spain has a comparative advantage in the production of bread. Ob. neither good and Spain has a comparative advantage in the production of both goods. Oc. both goods and Spain has a comparative advantage in the production of neither good. O d. bread and Spain has a comparative advantage in the production of cheese.
- The theory of comparative advantage: O a. Claims that economic well-being is enhanced if each country's citizens produce only a single product. Ob. Claims that economic well-being is enhanced when all countries compare commodity prices after adjusting for exchange rate differences in order to standardize the prices charged by all countries. O. Claims that economic well-being is enhanced if each country's citizens produce that which they have a comparative advantage in producing relative to the citizens of other countries, and then trade production. O d. Claims that no country has an absolute advantage over another country in the production of any good or service.The economic basis for trade is O none of these. O speculative attacks. O insourcing. O comparative advantage. O the race to the bottom.In a two-country, two-product world, the statement 'Germany enjoys a comparative advantage over France in cars relative to ships' is equivalent to O a. a. Germany having a comparative advantage over France in cars and ships. O b. France having a comparative disadvantage compared to Germany in cars and ships. O c. France having no comparative advantage over Germany. O d. France should produce cars. O e. France having a comparative advantage over Germany in ships. L
- The Ricardian theory of Comparative advantage relates to O Intermediate Outcome Short-run Outcome All the above O Long-run OutcomeAnswer th following: If Nation 2 is to enter trade. In what good will it specialize? Why? If Nation 2 is to specialize in the good of its comparative advantage, how much good X and good Y will Nation 2 produce? Suppose after specialization, Nation 2 exports 100 units of the good of its comparative advantage [your answer in 1], how much of X and Y will it consumer after trade Will Nation 2 enjoy welfare gains from trade? Provide evidenceIf China can produce cars at a lower cost than America using all Chinese-made parts, it has a comparative advantage rather than an absolute advantage. O True False
- The fictional country of Anastialia is a small country with rich resources in minerals. In a day it can produce 100 pounds of silver or 50 pounds of copper. Another country, West Burma, can produce 25 pounds of silver or 5 pounds of copper in a day. From this data, which country has the comparative advantage in copper production by producing it at a lower opportunity cost? O Neither country has a comparative advantage. O Anastialia O West BurmaAccording to the Infant Industry Argument Poor countries can foster economic development by using tariffs to protect new firms while they learn to become more productive. O Countries that allow children to work have an unfair advantage in international trade. O Costs of young firms are low because their workers lack seniority, and this contributes to comparative advantage. O When technological change creates a new product, it is the innovating country that is likely to be able to export it.A country has a (an) in the production of a good it produces at lower opportunity cost than another country. O absolute advantage O specialization disadvantage O tariff-efficient advantage O infant-industry advantage O none of the above No new data to save. Last 立