One July, the U.S sold aircraft worth $1 billion to China and bought aircraft worth only $19,000 from China. During the same month, however, the U.S bought $83 million worth of men’s trousers, slacks, and jeans from China but sold only $8,000 worth of trousers, slacks, and jeans to China. Using what you have learned about how trade is determined by comparative advantage , answer the following questions. (a) Which country has a comparative advantage in aircraft production and in production of trousers, slacks and jeans? (b) Which country has an absolute advantage in aircraft production and in production of trousers, slacks and jeans? Concept Introduction: Opportunity Cost : It is the cost of next best alternative activity. For example, A farmer can produce wheat, rice, and corn in his field and earns a profit of $100, $200 and $300 per month respectively. Then farmer will choose to grow corn in his field because he will get maximum profit by growing corn. So, the opportunity cost of growing corn will be $200 because the best alternative activity is growing rice because it will give him $200 per month. Comparative Advantage: When one country produces the good at lower opportunity cost than the other country, then the country that has produced the good at lower opportunity cost is said to have a comparative advantage in the production of that good. Absolute Advantage: It refers to the ability of a country to produce the same good with same resources at lower cost.

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A linear programming computer package is needed. As part of the settlement for a class action lawsuit, Hoxworth Corporation must provide sufficient cash to make the following annual payments (in thousands of dollars). 6 Year 1 23. 4 Payment 160 185 210 255 285 430 The annual payments must be made at the beginning of each year. The judge will approve an amount that, along with earnings on its investment, will cover the annual payments. Investment of the funds will be limited to savings (at 4% annually) and government securities, at prices and rates currently quoted in The Wall Street Journal. Hoxworth wants to develop a plan for making the annual payments by investing in the following securities (par value = $1,000). Funds not invested in these securities will be placed in savings. Security Current Price 1 $1,055 Rate (%) Years to Maturity 6.750 3 2 $1,000 5.125 Assume that interest is paid annually. The plan will be submitted to the judge and, if approved, Hoxworth will be required to…

Answer 1

Question

Definition Video Definition Ability of a country to produce goods and services at a lower opportunity cost compared to other countries. Here, opportunity cost refers to the forgone units of one good in order to produce one more unit of another good. For example, the opportunity cost of producing good X in country A is 2Y and in country B is 1.25Y. Country B has a lower opportunity cost of producing good X than country A. Therefore, country B has a comparative advantage in the production of good X. Video

Chapter 2, Problem 4P

To determine

One July, the U.S sold aircraft worth $1 billion to China and bought aircraft worth only $19,000 from China. During the same month, however, the U.S bought $83 million worth of men’s trousers, slacks, and jeans from China but sold only $8,000 worth of trousers, slacks, and jeans to China. Using what you have learned about how trade is determined by comparative advantage, answer the following questions.

(a)
Which country has a comparative advantage in aircraft production and in production of trousers, slacks and jeans?
(b)
Which country has an absolute advantage in aircraft production and in production of trousers, slacks and jeans?
Concept Introduction:

Opportunity Cost:

It is the cost of next best alternative activity. For example, A farmer can produce wheat, rice, and corn in his field and earns a profit of $100, $200 and $300 per month respectively. Then farmer will choose to grow corn in his field because he will get maximum profit by growing corn. So, the opportunity cost of growing corn will be $200 because the best alternative activity is growing rice because it will give him $200 per month.

Comparative Advantage:

When one country produces the good at lower opportunity cost than the other country, then the country that has produced the good at lower opportunity cost is said to have a comparative advantage in the production of that good.

Absolute Advantage:

It refers to the ability of a country to produce the same good with same resources at lower cost.

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A linear programming computer package is needed. As part of the settlement for a class action lawsuit, Hoxworth Corporation must provide sufficient cash to make the following annual payments (in thousands of dollars). 6 Year 1 23. 4 Payment 160 185 210 255 285 430 The annual payments must be made at the beginning of each year. The judge will approve an amount that, along with earnings on its investment, will cover the annual payments. Investment of the funds will be limited to savings (at 4% annually) and government securities, at prices and rates currently quoted in The Wall Street Journal. Hoxworth wants to develop a plan for making the annual payments by investing in the following securities (par value = $1,000). Funds not invested in these securities will be placed in savings. Security Current Price 1 $1,055 Rate (%) Years to Maturity 6.750 3 2 $1,000 5.125 Assume that interest is paid annually. The plan will be submitted to the judge and, if approved, Hoxworth will be required to…

Put the sections of Cornell notes in the order of completion.

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Answer 2

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Definition Video Definition Ability of a country to produce goods and services at a lower opportunity cost compared to other countries. Here, opportunity cost refers to the forgone units of one good in order to produce one more unit of another good. For example, the opportunity cost of producing good X in country A is 2Y and in country B is 1.25Y. Country B has a lower opportunity cost of producing good X than country A. Therefore, country B has a comparative advantage in the production of good X. Video

Chapter 2, Problem 4P

To determine

One July, the U.S sold aircraft worth $1 billion to China and bought aircraft worth only $19,000 from China. During the same month, however, the U.S bought $83 million worth of men’s trousers, slacks, and jeans from China but sold only $8,000 worth of trousers, slacks, and jeans to China. Using what you have learned about how trade is determined by comparative advantage, answer the following questions.

(a)
Which country has a comparative advantage in aircraft production and in production of trousers, slacks and jeans?
(b)
Which country has an absolute advantage in aircraft production and in production of trousers, slacks and jeans?
Concept Introduction:

Opportunity Cost:

It is the cost of next best alternative activity. For example, A farmer can produce wheat, rice, and corn in his field and earns a profit of $100, $200 and $300 per month respectively. Then farmer will choose to grow corn in his field because he will get maximum profit by growing corn. So, the opportunity cost of growing corn will be $200 because the best alternative activity is growing rice because it will give him $200 per month.

Comparative Advantage:

When one country produces the good at lower opportunity cost than the other country, then the country that has produced the good at lower opportunity cost is said to have a comparative advantage in the production of that good.

Absolute Advantage:

It refers to the ability of a country to produce the same good with same resources at lower cost.

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Answer 3

Question

Definition Video Definition Ability of a country to produce goods and services at a lower opportunity cost compared to other countries. Here, opportunity cost refers to the forgone units of one good in order to produce one more unit of another good. For example, the opportunity cost of producing good X in country A is 2Y and in country B is 1.25Y. Country B has a lower opportunity cost of producing good X than country A. Therefore, country B has a comparative advantage in the production of good X. Video

Chapter 2, Problem 4P

To determine

One July, the U.S sold aircraft worth $1 billion to China and bought aircraft worth only $19,000 from China. During the same month, however, the U.S bought $83 million worth of men’s trousers, slacks, and jeans from China but sold only $8,000 worth of trousers, slacks, and jeans to China. Using what you have learned about how trade is determined by comparative advantage, answer the following questions.

(a)
Which country has a comparative advantage in aircraft production and in production of trousers, slacks and jeans?
(b)
Which country has an absolute advantage in aircraft production and in production of trousers, slacks and jeans?
Concept Introduction:

Opportunity Cost:

It is the cost of next best alternative activity. For example, A farmer can produce wheat, rice, and corn in his field and earns a profit of $100, $200 and $300 per month respectively. Then farmer will choose to grow corn in his field because he will get maximum profit by growing corn. So, the opportunity cost of growing corn will be $200 because the best alternative activity is growing rice because it will give him $200 per month.

Comparative Advantage:

When one country produces the good at lower opportunity cost than the other country, then the country that has produced the good at lower opportunity cost is said to have a comparative advantage in the production of that good.

Absolute Advantage:

It refers to the ability of a country to produce the same good with same resources at lower cost.

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Answer 4

Question

Definition Video Definition Ability of a country to produce goods and services at a lower opportunity cost compared to other countries. Here, opportunity cost refers to the forgone units of one good in order to produce one more unit of another good. For example, the opportunity cost of producing good X in country A is 2Y and in country B is 1.25Y. Country B has a lower opportunity cost of producing good X than country A. Therefore, country B has a comparative advantage in the production of good X. Video

Chapter 2, Problem 4P

To determine