Connect Access Card For Principles Of Macroeconomics, 7th
7th Edition
ISBN: 9781260111019
Author: Frank Robert H
Publisher: McGraw-Hill Education
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Question
Chapter 16, Problem 1RQ
To determine
Describe the comparative and absolute advantages between US and china.
Expert Solution & Answer
Explanation of Solution
The US has absolute and
Economics Concept Introduction
Absolute advantage: Absolute advantage is an advantage of a country to produce more than its competitors using the same or less production time and resources.
Comparative advantage: Comparative advantage is an advantage of a country to produce at a lower
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Suppose that Canada can produce 100,000 hockey sticks or 10,000 gallons of maple syrup in a typical workweek, while Germany can produce 90,000 hockey sticks or 10,000 gallons of maple syrup in a typical workweek. From these numbers, we can conclude:
Question 48 options:
Canada has a comparative advantage in the production of hockey sticks.
Germany has a comparative advantage in the production of hockey sticks.
Canada has an absolute advantage in the production of maple syrup.
Germany has an absolute advantage in the production of maple syrup.
Ecuador’s biggest export is crude petroleum (unprocessed), 63% of which it exports to the United States, and Ecuador’s biggest import is refined petroleum (processed), of which it imports 70% from the United States. Based on this information, which of the following statements is true?
Group of answer choices
Ecuador has comparative advantage in extracting crude petroleum; the US has comparative advantage in producing refined petroleum.
Not enough information.
The US has comparative advantage in extracting crude petroleum; Ecuador has comparative advantage in producing refined petroleum.
Ecuador has absolute advantage in extracting crude petroleum and the US has absolute advantage in producing refined petroleum.
England and Scotland both produce scones and sweaters. Suppose that an English worker can produce 40 scones per hour or 1 sweater per hour. Suppose that a Scottish worker can produce 20 scones per hour or 2 sweaters per hour.
workers have an absolute advantage in producing scones, and workers have an absolute advantage in producing sweaters.
workers have a comparative advantage in producing scones, and workers have a comparative advantage in producing sweaters.
If England and Scotland decide to trade, Scotland will trade to England.
If an English worker could produce only 20 scones per hour, England gain from trade, and Scotland gain from trade.
Chapter 16 Solutions
Connect Access Card For Principles Of Macroeconomics, 7th
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