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.

In a PPC graph, if free trade makes the budget line become flatter and the comparative advantage good is on the y - axis, what has free trade done to the country's terms of trade?

A person or nation that has a comparative advantage in the production of a good, should A) Specialize in the production of that good B) Have the highest opportunity cost C) Not specialize in the production of that good D)Automatically has an absolute advantage

The United States and Canada have the production possibilities curves shown above.  It is determined that the United States has the comparative advantage in peanuts. Will both nations gain from trade if the terms of trade that are offered are 1 Peanut= 3 Corn? Why or why not? Show your work.

Determine the equilibrium price of good x (setting the price of good x as 1) that prevails at Home and Foreign under autarky – that is, when they do not trade with each other. Explain why any other price could not be the equilibrium price in autarky.

A small island nation of Gondwana can produce either 40 Apple iPhones (Apple for short) or 80 Samsung Galaxy phones (Samsung for short) every hour. A small island nation of Pandea can produce 75 Apple or 100 Samsung phones every hour. Without trade, each island nation consumes everything it produces. Assume that labor is the only resource they need on each island. If they decide to trade, transportation cost is zero. After 10 hours of work right now, Gondwana produces 200 Apple and 400 Samsung phones, Pandea produces 375 Apple and 500 Samsung  phones. (a) Who if any has a comparative advantage in Apple iPhones? Who if any has a comparative advantage in Samsung Galaxy phones? (b) Is it possible for both Gondwana and Pandea to improve their consumption levels in one or both products, without decreasing consumption in any of the products? If no, explain why; if yes, give an example of production schedule and trade flows that would be mutually beneficial. (c) Give a range of prices of…

Various international crises and issues periodically raise the price of oil imports, which can send ripple effects throughout the economy. While it might not be the producer that other countries are, the U.S. has vast supplies of oil. What is a likely reason it still imports oil despite the impact of these international influences on prices?   Group of answer choices   Importing oil allows the U.S. to focus on developing other industries.   The U.S.’s environmental standards are too high to produce oil domestically.   The opportunity costs of producing all oil products domestically must still be higher than importing.   The U.S. is trying to prop up its political partners by importing their oil.

(e) Assume that Home and Foreign open to trade with each other. Explain how is the pattern of trade (which good will each country export and import) determined

Two countries, Alpha and Beta consider the construction of a bridge across a river that separates them. The bridge would increase commerce and trade in both countries. If they both contribute to the building of this bridge, then each receive a profit of $32 million. However, if they both fail to contribute, they are each left with a profit of just $30 million. If one country contributes and the other one does not, then the country that does not contribute is a “free rider” and will receive a profit of $35 million. The contributing player spends a lot of money building the bridge and is left with a profit of only $28 million. 5.1. Fill out the payoff matrix (below) for the game by including all the elements (players, their strategies, and their payoffs).                           5.2. Assume the players do not cooperate. Solve the game for the Nash equilibrium (find out the strategy played by each player in equilibrium). What is the payoff each gets…

The table below shows one of the most preferred trade exercises in your class, according to your classmates' votes. Refer to it to answer the following question. Burrito 40/hr Bowl 44/hr Chipotle Hot Head Burritos 36/hr 42/hr Chipotle has comparative advantage in (type either burritos or bowls).