Which statement is true? Group of answer choices If one party is more productive in producing both products, it has a comparative advantage in producing both goods None of the listed statements are true A party can have a comparative disadvantage in producing both goods A party has the comparative advantage in producing a good if it has the absolute advantage in producing the other good If parties specialise and trade, it is only the less productive party that can experience any gains from trade

Why is it important that the country or region with the lower opportunity cost produce the good? How would you use the concept of comparative advantage to argue for reducing restrictions on trade between countries?

When a country has a comparative advantage in the production of a good, it means that it can produce this good at a lower opportunity cost than its trading partner. Then the country will specialize in the production of this good and trade it for other goods. The following graphs show the production possibilities frontiers (PPFS) for Yosemite and Rainier. Both countries produce com and lentils, each Initially (l.e., before specialization and trade) producing 30 million pounds of corn and 15 million pounds of lentils, as indicated by the grey stars marked with the letter A. LENTILS (Milions of pounds) 80 70 60 50 40 30 20 10 0 80 70 60 80 50 70 Note: Dashed drop lines will automatically extend to both axes. 40 60 30 50 20 40 10 30 PPF 0 20 10 0 0 0 Yosemite has a comparative advantage in the production of while Rainler has a comparative advantage in the production of . Suppose that Yosemite and Rainier specialize in the production of the goods in which each has a comparative advantage.…

The following statement is true about comparative advantage. The principle was developed by the British Economist Henry Ford. A country with fewer environmental regulations and lower wages has a comparative advantage in modern manufacturing. Silicon Valley has a comparative advantage in high-technology due to a local abundance of silicon dioxide. The principle of comparative advantage is used to justify self-sufficiency and local production of goods.

READ THOROUGHLY! Molly is Person A; John is person B 2 people from the same house do two things: they give rides and deliver meals  Molly can provide 4 taxi rides or 2 meal deliveries in an hour. John can provide 5 taxi rides or 4 meal deliveries in an hour. Who has the absolute advantage in the provision of taxi rides? Who has the comparative advantage in the provision of taxi rides? Absolute advantage: Person A Comparative advantage: Person A Absolute advantage: Person B Comparative advantage: Person A Absolute advantage: Person A Comparative advantage: Person B Absolute advantage: Person B Comparative advantage: Person B What is a price of taxi rides (in terms of meal deliveries) at which BOTH Molly and John will be better o" by specialization and trade?

Martha and Dave like to make identical tacos and cakes. The time it takes Martha and Dave to make tacos and cakes is given in the table below.   Martha Dave Time to make a taco 10 minutes 15 minutes Time to make a cake 20 minutes 30 minutes Which person has an absolute advantage in the production of tacos, and which person has an absolute advantage in the production of cakes? Group of answer choices Martha has an absolute advantage in producing both goods. Dave has an absolute advantage in producing both goods. Neither Dave nor Martha has an absolute advantage at producing either good. Both Martha and Dave have an absolute advantage in producing both goods. Martha has an absolute advantage in tacos; Dave has an absolute advantage in cakes.

When a country has a comparative advantage in the production of a good, it means that it can produce this good at a lower opportunity cost than its trading partner. Then the country will specialize in the production of this good and trade it for other goods. The following graphs show the production possibilities frontiers (PPFs) for Glacier and Rainier. Both countries produce corn and basil, each initially (i.e., before specialization and trade) producing 18 million pounds of corn and 9 million pounds of basil, as indicated by the grey stars marked with the letter A. BASIL (Millions of pounds) 48 42 36 30 24 18 12 6 0 0 PPF 6 Glacier A 12 18 24 30 36 CORN (Millions of pounds) 42 48 ? BASIL (Millions of pounds) 48 42 36 30 24 18 12 6 0 0 PPF I + 6 Rainier 12 18 24 30 36 CORN (Millions of pounds) I 42 48 (?) Glacier has a comparative advantage in the production of while Rainier has a comparative advantage in the production of Suppose that Glacier and Rainier specialize in the production…

Assume that two countries Alpha and Beta use a variety of inputs in their production Alpha exports excavating equipment and imports solar cells. Assume furthermore no economies of scale. Select the correct statement from the ones below: Even though there is trade, Alpha has a lower opportunity cost for excavating If the countries did not trade, Alpha would have a lower opportunity cost for excavating Neither country can consume at a point outside its production possibility frontier. Alpha avoids producing solar cells while B avoids producing no excavating

Suppose you have a team of two workers: one is a baker and one is a chef. Your baker is talented but is inexperienced. Your chef is not only an elite chef but is also faster at baking. If your kitchen specialized according to absolute advantage, who would do the cooking? Who would do the baking? If your kitchen specialized according to comparative advantage, who would do the cooking? Who would do the baking? Which approach above is more efficient? Explain your answer.