Nation alpha can produce either 3 units of good X or 1 unit of good Y with 1 hour of labour whereas nation beta can produce either 4 units of good X or 2 units of good Y with one hour of labor . Assuming that labor is the only input then ?
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Nation alpha can produce either 3 units of good X or 1 unit of good Y with 1 hour of labour whereas nation beta can produce either 4 units of good X or 2 units of good Y with one hour of labor . Assuming that labor is the only input then ?
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- The table below shows the number of labor minutes it takes for each employee to produce one pizza and one salad. Compare all 3 employees to one another and determine which one of the following statements is true? Select one: a. Carter has a comparative advantage in making Salad b. Carter has an absolute advantage in both products c. Melanie has a comparative advantage in making Pizza d. Jackson has a comparative advantage in making Salad e. Melanie has a comparative advantage in making Salad f. Jackson has an absolute advantage in both products g. Carter has a comparative advantage in making PizzaThere are 2 countries, D and F. There are 2 products X and Y. Each country has only a single input labor hours, Li, j, where i is D for Domestic or F for Foreign and j is either X for Good X use of the labor or Y for Good Y use of labor. In country D: XD = aD*LD, X YD = bD*LD, Y LD = LD, X + LD, Y In country F: XF = aF*LF, X YF = bF*LF, Y LF = LF, X + LF, Y At the moment: aD = 0.25, bD = 0.5, LD = 32, aF = 0.8, bF = 0.4, LF = 40. Each country is operating in autarky and has determined to divide its labor force equal between the production of X and Y Now the two countries open to trade. The Terms of Trade are set 1 unit of X for 1.5 units of Y. The countries exchange exactly 4 units of X. The countries partially specialize in their areas of comparative advantage. How much labor must it move from producing Y to producing X to increase its production of X by 4 units? ∆L = In the country that specializes in producing Y, how much additional Y must it produce? ∆Y =…Assume China has 10,000 workers. Suppose that each Chinese worker produces either 30 pairs of boots or 10 software per month. Suppose that half of Chinese workers produce boots and half produce programs. What quantities of boots and software does China produce? Are these production combinations efficient?
- "Accoring to Ricardo's analysis, a country exports any good whose production requires fewer labor hours per unit than the labor hours per unit needed to produce the good in the foreign country. That is, the country exports any good in which its labor producivity is higher than the labor productivity for this good in the foreign country." Do you agree or disagree? why?Consider a Production Possibility Frontier that bows outward. Suppose the production of one good increases. As a result opportunity cost of producing this good will __________ because productive resources ___________________ in their suitability for producing different kinds of goods. A. increase; differ B. decrease; are the same C. increase; are the same D. decrease; differWhich of the following are made constant when applying the production possibilities curve theory? Select one: a. Trading rate between goods b. Total exports and imports c. Total number of factors of productions d. International pricing
- Suppose you have a team of two workers: one is a baker and one is a chef. Your baker is talented but is inexperienced. Your chef is not only an elite chef but is also faster at baking. If your kitchen specialized according to absolute advantage, who would do the cooking? Who would do the baking? If your kitchen specialized according to comparative advantage, who would do the cooking? Who would do the baking? Which approach above is more efficient? Explain your answer.If there are two provinces (A and B) that can produce two goods (X and Y), such that province A can produce 90 X or 10 Y, while province B can produce 42 X or 6 Y, then if we want the total production of Y for both provinces combined to be 12, then the maximum production of X will be __________.Q. The country A has an endowment (total supply) of 160 units of labor and 14 units of land, whereas country B has 40 units of labor and 6 units of land. Is country B labor or land abundant? If wheat is land-intensive and cloth is labor-intensive, what is the Heckscher-Ohlin prediction for the pattern of trade between country A and country B?
- Consider a specific-factors model where two Countries, Denmark and Tanzania, use labor to produce cake (C) and helicopters (H). However, arable land (A) are a factor specific to cake, and jerrycans (J) are a factor specific to helicopters. Suppose that Tanzania has L = 100 workers, J = 40 jerrycans, and A = 1000 arable land. The production functions and marginal products of labor for cake and helicopters are: C = 4 x Lc0.5 x A0.5 MPLc = 2 x Lc-0.5 x A0.5 H = 4 x LH0.5 x J0.5 MPLH = 2 x LH-0.5 x J0.5 In Tanzania, the price of crystals is 20 and the price of hyperdrives is 200. In this case, the wage rate will be ________ and ________ workers will be employed in the cake industry and __________ workers will be employed in the helicopter industry.Suppose there are two countries, Home and Foreign, that produce two goods, fish (F) and edamame (E), using only labor. In the Home country 6 units of labor are required to produce each unit of fish and the same for each unit of edamame. In the Foreign country, 2 units of labor is required to produce each fish and 3 units of labor are required for each unit of edamame. Each country has a labor force of 30 units available for production. Suppose further that consumers in both countries have identical Leontief preferences, utility function U(CF, CE) = min(CF, CE), meaning that they want to consume the two goods in a fixed proportion of one-to-one, i.e. CF = CE (there is no substitution between the goods). Suppose now that the labor force of the Home country is 6 times as big (i.e. 180 units, instead of 30). How does this increase in labor force at Home change the pattern of trade? Will the gains from trade for the Home country be higher or lower now? What happens to the welfare of the…Q84 The law of one price says that the price of... a. Labour, measured in terms of its opportunity cost, is the same in all markets. b. A product that is costless to transport will be the same in all markets. c. A product is always equal to the absolute cost of the resources that went into its production in any country. d. Natural resources is the same in all markets. e. A product worldwide is always equal to the cost of production from the country with the lowest opportunity cost to make the product.