MICROECONOMICS(LL)COMPANION
21st Edition
ISBN: 9781260713541
Author: McConnell
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Question
Chapter 26.2, Problem 4QQ
To determine
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
To produce 1 unit of cotton country X uses 25 units of labor and country Y uses 16 units of labor. To produce 1 unit of wheat country X uses 12 units of
labor and country Y uses 9 units of labor. Which country has the comparative advantage in wheat production? Why?
If higher tariffs, such as those enacted by the Smoot-Hawley trade bill, reduce the imports of the United States, which of the following will
be most likely to occur?
a. U.S. employment will increase.
b. The unemployment rate of the United States will decline.
c. U.S. exports will increase because foreigners will want to buy more from U.S. producers.
d.
U.S. exports will decline because foreigners will be earning fewer of the dollars needed to purchase goods and services from
Americans.
Country A can produce 20 units of wheat or 10 units of corn, while Country B can produce 15 units of wheat or 5 units of corn.
Which country has the comparative advantage in producing wheat?
Chapter 26 Solutions
MICROECONOMICS(LL)COMPANION
Ch. 26.2 - Prob. 1QQCh. 26.2 - Prob. 2QQCh. 26.2 - Prob. 3QQCh. 26.2 - Prob. 4QQCh. 26 - Prob. 1DQCh. 26 - Prob. 2DQCh. 26 - Prob. 3DQCh. 26 - Prob. 4DQCh. 26 - Prob. 5DQCh. 26 - Prob. 6DQ
Ch. 26 - Prob. 7DQCh. 26 - Prob. 8DQCh. 26 - Prob. 9DQCh. 26 - Prob. 10DQCh. 26 - Prob. 11DQCh. 26 - Prob. 12DQCh. 26 - Prob. 13DQCh. 26 - Prob. 14DQCh. 26 - Prob. 1RQCh. 26 - Prob. 2RQCh. 26 - Prob. 3RQCh. 26 - Prob. 4RQCh. 26 - Prob. 5RQCh. 26 - Prob. 6RQCh. 26 - Prob. 7RQCh. 26 - Prob. 8RQCh. 26 - Prob. 9RQCh. 26 - Prob. 10RQCh. 26 - Prob. 11RQCh. 26 - Prob. 12RQCh. 26 - Prob. 13RQCh. 26 - Prob. 1PCh. 26 - Prob. 2PCh. 26 - Prob. 3PCh. 26 - Prob. 4P
Knowledge Booster
Similar questions
- Which of the following is an issue with "infant industry" tariffs? a. Mature industries often require tariff protection. b.Stock holders will capture the protective effect in lower profits. c.As the industry matures, special-interest groups may fight to keep the tariff. d.Foreign consumers will purchase the foreign good regardless of the size of the tariff.arrow_forwardwhen romania opened itself to international trade, the price of corn in romania almost doubled. does romania has comparative advantage in the production of corn? is romania an exporter or an importer of corn romania consumers of corn will be better off or worse off? how about the producers ? are there any gains from international trade?arrow_forward3. Two areas, Europe and America, can produce only goods A and B, under constant costs as indicated below. What will be the result of free trade between the two areas? In Europe In America 1 unit of good A 2 hours of labor 3 hours of labor 1 unit of good B 4 hours of labor 5 hours of labor a. Europe will export A and B to America. b. Europe will import A and export B. c. Europe will import B and export A. d. Europe will import A and B from America. e. No trade will take place.arrow_forward
- Which of the following statements about international trade is true? Answers: A. On a global scale imports must equal exports. B. Typically, countries with a large GDP experience a trade surplus. C. With trade, world consumption possibilities decrease. D. On a global scale, exports are greater than imports.arrow_forwardassist and explain Which of the following statements best exemplifies the concept of relative advantage in international trade?A. USA can produce both wheat and textiles more efficiently than any other country.B. USA can produce wheat more efficiently than China, while China can produce textiles moreefficiently than USA.C. USA can produce more wheat than China, but China can produce more textiles than USA.D. USA and China have the same level of efficiency in producing wheat and textiles.arrow_forwardWhat is the opportunity cost of a pair of shoes in Mexico? What is the opportunity cost of a pair of shoes in Nicaragua ? Which country has a comparative advantage in the production of shoes? Which country has a comparative advantage in the production of clothing? In this example, the country of Mexico should export ----------and import ----------------.arrow_forward
- France Germany Cheese 2 kilograms 1 kilogram Cars 0.25 0.5 b. What is the relative price of cheese in France if it does not trade? In Germany? c. What is the opportunity cost of cheese in France? In Germany? d. Which country has a comparative advantage in cheese? In cars? Explain your answer. e. What are the upper and lower bounds for the trade price of cheese? f. Draw a hypothetical PPC for France and label its slope. Suppose that France follows its comparative advantage in deciding where to produce on its PPC. Label its production point. If the trade price of cars is 5 kilograms of cheese per car, draw a trade line (CPC) showing how France can gain from trade.type solution plsarrow_forwardTwo countries, A and B, produce cotton and wine. The table below describes their maximum daily production of each good in kilograms for cotton and liters for wine. Maximum daily production Country A Country B Cotton 40 40 Wine 50 40 Which country has the comparative advantage in the production of a. wine? Why? b. If these two countries trade, which good will each of them export? Why?arrow_forwardEconomists argue for free trade in import markets because importing goods decreases total surplus. no one is made worse off by importing goods. all consumers and producers benefit from importing goods. O the gains to the U.S. producers outweigh the losses to the U.S. consumers the gains to the U.S. consumers outweigh the losses to the U.S. producersarrow_forward
- Which of the following follows when a nation opens up for trade and starts exporting a good? A. The price that domestic manufacturers of the good are paid declines. B. Domestic consumers of the good benefit more than domestic producers of the good, who suffer losses. C. Domestic producers of the good profit more than domestic consumers of the good lose. D. The cost of the commodity for domestic consumers lowers.arrow_forwardassist please Which of the following statements best exemplifies the concept of relative advantage in international trade?A. USA can produce both wheat and textiles more efficiently than any other country.B. USA can produce wheat more efficiently than China, while China can produce textiles moreefficiently than USA.C. USA can produce more wheat than China, but China can produce more textiles than USA.D. USA and China have the same level of efficiency in producing wheat and textiles.arrow_forwardWhat is the concept of comparative advantage in international trade? A. A country's ability to produce all goods more efficiently than other countries B. A country's ability to produce a good at a lower opportunity cost than other countries C. A country's ability to produce goods using the most advanced technology D. A country's ability to produce goods at the lowest absolute costarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Exploring EconomicsEconomicsISBN:9781544336329Author:Robert L. SextonPublisher:SAGE Publications, IncEconomics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning
Exploring Economics
Economics
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:SAGE Publications, Inc
Economics (MindTap Course List)
Economics
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Cengage Learning