When opportunity costs differ between countries, ... a. Comparative advantages may not exist. b. Only the larger countries will benefit from trade. c. Each country should produce only those goods for which it has an absolute advantage. d. Specialisation and trade can lead to increases in the production of all commodities. e. Only the smaller countries will benefit from trade.

Q: Suppose that Greece and Sweden both produce rye and shoes. Greece's opportunity cost of producing a…

A: If a country has a lower opportunity cost of producing the good, it is said to have a comparative…

Q: 4. To produce 1 unit of cotton Country X uses 25 units of labor and Country Y uses 16 units of…

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A: The opportunity cost  of moving from one economical combination of production to a different…

Q: Suppose that Portugal and Sweden both produce rye and wine. Portugal's opportunity cost of producing…

A: According to comparative advantage theory, a country is said to have a comparative advantage in the…

Q: Country A Country B 200 Corn 600 150 375 t00 50 50 75100 150 200 25 cars 50 75 100 cars a) What is…

A: The opportunity cost is the difference between the time spent studying and the money spent on…

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A: According to the question given,  Jennereelam can produce 80 million kilos of cereal and 200…

Q: c. What might be a set of favorable terms of trade for the two countries? d. Prove that both…

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Q: nder what conditions might the mainstream argument about the advantages of specialization based on…

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Q: has an absolute advantage in the production of barley, and has an absolute advantage in the…

A: Van has absolute advantage in production of barley. because van can produce 40 bushels per acre…

Q: For each hour worked, a U.S. worker can produce 4 dozen baguettes, or 2 tonnes of aluminum. Canadian…

A: Comparative advantage refers to a situation where one country or person produces the good at a lower…

Q: If the opportunity cost for US was 1 shoe = -10 sweaters and Canada's opp cost was 1 shoe = -20…

A: The opportunity cost is the cost/benefit forgone, when an another alternative is chosen. Therefore,…

Q: How can we maximize global production through specialization? Absolute and comparative advantage are…

A: Absolute advantage occurs when a country can produce more of a good at same cost than other country…

Q: Suppose that each U.S. worker can produce 8 units of food or 2 units of clothing daily. In Fredonia,…

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Q: has an absolute advantage in the production of corn, and has an absolute advantage in the production…

A: The production possibility frontier(PPF) is the combination of goods that be produced at the maximum…

Q: he United States and Canada have the production possibilities curves shown above.  It is determined…

A: United States 60 Corns if only manufacture corns 60 Peanuts if only manufacture peanuts Canada 60…

Q: d) When trade opened which country exports which good? Suppose the international price is ½ bottle…

A: D)The respective country will export goods in which they have a comparative advantage.  Just as…

Q: 06. If Portugal has a total of 180 man-hours of resources available for production, while England…

A: Portugal:Opportunity cost of producing wine=3090=13Opportunity cost of producing cloth=9030=3

Q: Suppose that the world economy consists of Country A and Country B, both of which are of similar…

A: A country is said to have a competitive advantage if it can produce the good at a lower opportunity…

Q: Suppose an economist develops an international trade model based on the assumption that there are…

A: The exchange of goods and services between two or more nations in the world is referred to as…

Q: try A having comparative advantage in wheat and country B in térs, according to the…

A: Disclaimer- “Since you have asked multiple question, we will solve the only first question for you…

Q: Relative to China, in which industries do you think the US has a comparative advantage (in which…

A: US is a developed and one of the most developed economy in the world.

Q: In theory of comparative advantage, which statement is correct O a a country should produce all…

A: The theory of comparative advantage in international trade is given by David Recardo.

Q: Differentiate absolute advantage from comparative advantage.  Explain how a country should…

A: a. Absolute advantage Vs Comparative advantage 1. Absolute advantage relates to a country's or…

Q: Determine which country has a comparative advantage in each good . b) If Country A and Country B…

A: Unit labor Requirements   Country A Country B Steel 4 4 Oil 2 5

Q: What is the relationship between production costs and comparative advantage? Comparative advantage…

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Q: 3. Absolute and comparative advantage Consider two neighboring island countries, Charisma and…

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Q: Hypothetically, the countries of Pakistan and India can produce two goods: bicycles and buses. (a)…

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Q: Use the following data to explain the difference between absolute advantage (SMITH) and comparative…

A: Absolute advantage refers to the ability to produce more goods using same resources or same quantity…

Q: The accompanying tables give production possibilities data for Gamma and Sigma. All data are in…

A: Answer: Correct option: option 4 (40 tons of Tea) Explanation: A producer will have a comparative…

Q: 56 56 48 48 PPF 40 40 32 32 24 PPF 24 16 16 - -- -- -- - 8 16 24 32 40 48 56 64 16 24 32 40 48 56 64…

A: Opportunity cost refers to the loss due to giving up the best alternative in making a decision.

Q: 3. Are the following statements true or false? Explain in each case. (a) "Two countries can achieve…

A: Trade: Exchange includes exchanging products or administrations starting with one individual or…

Q: 42 42 36 36 PPF 30 30 24 24 18 PPF 18 12 12 5 -- -- 6. 0 6 12 18 24 30 36 42 48 6 12 18 24 30 36 42…

A: Comparative advantage is an effective tool or method to make international trade to be beneficial…

Q: Labour hours needed to make 1 unit Cars Airplanes Amount producedin 24 hours: Airplanes Cars Canada…

A: Comparative advantage is theory which tells about that a country should export that goods and…

Q: advantage can also be The comparative demonstrated with agents rather than countries. Let's say that…

A: Comparative advantage refers to the ability to produce goods and services at a lower opportunity…

Q: has an absolute advantage in the production of corn, and has an absolute advantage in the production…

A: Given:   Corn  Rye Hubert 20 4 Kate 28 7

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A: A country is said to have  comparative advantage if it can produce the good at lower opportunity…

Q: Specialization will increase output when it is based on: absolute advantage. O comparative…

A: Absolute advantage refers to a country’s capacity to produce a certain good more efficiently than…

Q: Suppose that in the United States, the opportunity cost of producing a motor engine is 4 auto…

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Q: 1. Suppose there are two countries Peru and Japan that produce Food and Fuel. Peru can produce 7,523…

A: Absolute advantage: If a country has a lower cost of producing a commodity compared to some other…

Q: 11. If Portugal has a total of 120 man-hours of resources available for production, while England…

A: Answer: Correct option: (b) Portugal Explanation: The country which has the least opportunity cost…

Q: d. Assuming no trading between the two, if both countries wanted to have equal numbers of tons of…

A: d. The number of workers multiplied by the productivity of one worker is the total number of workers…

Q: Comparative Advantage: Suppose that the United States and Switzerland produce bicycles and chocolate…

A: Country U has absolute advantage in both the products as production per worker per year is higher…

Q: 1. How do individuals evaluate opportunity costs to make business decisions?

A: The individuals would result in the making trade offs to reach goals and make choices to obtain…

Q: You have a comparative advantage if you can complete a task: at a higher opportunity cost than…

A: Comparative advantage is when a producer is able to produce at a lower opportunity cost than any…

Q: Assuming labor is the only resource and England has 60 man-hours (mhrs) and Portugal 180 mhrs of…

A: Comparative advantage is an economy's ability to produce a particular good or service at a lower…

Q: Comparative advantage explains why people _____. Select one: a. work at the job they love and grow…

A: In the theory of international trade, comparative advantage occurs when a country has a lower…

Q: Suppose Armenia has a comparative advantage in electronics in trade with Turkey. However, it does…

A: Comparative advantage is the ability of the country to produce goods and services at a lesser…

Comparative Advantage and Absolute Advantage Analysis

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