Economics (MindTap Course List)
13th Edition
ISBN: 9781337617383
Author: Roger A. Arnold
Publisher: Cengage Learning
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Chapter 2, Problem 9WNG
To determine
Explain who has the
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Q)Suppose that country A using one unit of labor can produce 80 pounds of apples or 20 pounds of oranges, while country B using the same unit of labor can produce 40 pounds of apples or 15 pounds of oranges. This shows that:
Group of answer choices
If A and B trade, A should specialize in the production of oranges.
B has an absolute advantage in the production of apples.
B has a comparative advantage in the production of apples.
B has a comparative advantage in the production of oranges.
The table below shows the maximum quantities of two goods that each country can produce. If the countries follow the principle of comparative advantage, which of the following is a potential benefit of trade?
Vibranium (tons)
Gold (tons)
Wakanda
8 tons
2 tons
Zamunda
2 tons
1 ton
Group of answer choices
Trade can allow each country to increase consumption beyond its production possibilities frontier.
Trade can allow each country to shift its production possibilities frontier outward to higher levels of production.
Trade can allow each country to become less vulnerable to the actions of the other country.
All of these answers are correct.
True or False. Both Countries would be better off if they produced the good in which they have a comparative advantage and then traded 300 million tons of grain for 200 million cars.
Chapter 2 Solutions
Economics (MindTap Course List)
Ch. 2.1 - Prob. 1STCh. 2.1 - Prob. 2STCh. 2.1 - Prob. 3STCh. 2.1 - Prob. 4STCh. 2 - Prob. 1QPCh. 2 - Prob. 2QPCh. 2 - Prob. 3QPCh. 2 - Prob. 4QPCh. 2 - Prob. 5QPCh. 2 - Prob. 6QP
Ch. 2 - Prob. 7QPCh. 2 - Prob. 8QPCh. 2 - Prob. 9QPCh. 2 - Prob. 10QPCh. 2 - Prob. 11QPCh. 2 - Prob. 12QPCh. 2 - Prob. 13QPCh. 2 - Prob. 1WNGCh. 2 - Prob. 2WNGCh. 2 - Prob. 3WNGCh. 2 - Prob. 4WNGCh. 2 - Prob. 5WNGCh. 2 - Prob. 6WNGCh. 2 - Prob. 7WNGCh. 2 - Prob. 8WNGCh. 2 - Prob. 9WNGCh. 2 - Prob. 10WNGCh. 2 - Prob. 11WNGCh. 2 - Prob. 12WNG
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