When countries specialize in producing certain goods and then freely exchange those goods for other goods with different countries, what is the advantage? Group of answer choices Each country can consume at a point outside their production possibilities frontier. All people in each country will be better off than they would be if they did not trade. Each country can produce at a point outside their production possibilities frontier. Each country can produce and consume at a point outside their production possibilities frontier.

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Q: Define comparative advantage with the use of opportunity cost. Give a real life example of it.

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Q: Suppose that Maldonia and Desonia agree to trade. Each country focuses its resources on producing…

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Q: According to the concept of comparative advantage, a good should be produced in that nation where:…

A: Comparative advantage is the abiity of the nation to produce the good at a lower opportunity cost.

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Q: To say that countries gain from trade means that: a) if one country has an absolute advantage over…

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Q: How does the fact that many goods are non-traded affect the extent of possible gains from trade?

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Q: In the past, comparative advantages have sometimes shifted from one nation to another. What factors…

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A: Three economic questions must be determined in all societies .what are they.

Q: How can trade affect a third party positively?

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Q: Which country has the absolute advantage in production of Good A? Group of answer choices Country Y…

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A: The ability to create goods and services at a lower cost, without necessarily doing so at a higher…

Q: A e B i Suppose that there are 10 million workers in Canada and that each of these workers can…

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Q: A country produces two goods and the opportunity cost of production of each good is constant. This…

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Q: A widget has an opportunity cost of 4 wadgets in Saudi Arabia and 2 wadgets in the United States.…

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Q: Country A specializes in producing kiwis. Country B specializes in producing oranges. As a result,…

A:

Q: When countries specialize based on their comparative advantage and trade with each other, how does…

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Q: Alpha can produce either 18 oranges or 9 apples an hour, while Beta can produce either 16 oranges or…

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Q: Isabella and Antonio are auto mechanics. Isabella takes 4 hours to replace a clutch and 2 hours to…

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Q: Freedonia Lamponia 16 16 14 14 12 12 PPF 10 10 8 8 PPF 4 2 2 + 4 8 10 12 14 16 2 4 8 10 12 14 16…

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Q: How could agreements between Mexico and western states of the United States best be improved? They…

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Q: If a country opens up for trade, and it ends up importing a good, the net effect of importing that…

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Q: Suppose the United States and Mexico both produce hamburgers and tacos. The combinations of the two…

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Comparative Advantage and Absolute Advantage Analysis

The theory of absolute advantage was given by Adam Smith in the year 1776.