Homework Answers
Q.5 ans : B. Country A has a comparative advantage in the production of product X.
This would be because, a lower price of product X signifies that there is good production level in country A in comparison to country B where the prices are high even though the production is there as well. Comparative advantage is a situation when a country earns better by exporting a good that is produced in goods quantities and lower prices in place of the other good that is produced similarly in any other country. Hence this results in a profitable situation for both.
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Question 5 (2.5 points) Prior to international trade, the price of good X is lower in...
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QUESTION 9 When a country's imports is greater than its exports, the country is experiencing a...
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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
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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.
4. Specialization and trade 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 Candonia and Lamponia. Both countries produce potatoes and coffee, each initially (i.e., before specialization and trade) producing 6 million pounds of...
International Economic Relations: Consider the following input-output table, please answer questions a-h. Note that a one...
International Economic Relations:
Consider the following input-output table, please answer questions a-h. Note that a one word answer is not acceptable. For full credit, you must provide explanation for your answers and show how you arrive at them. Man Hours Required to Produce Unit of Output Country A Country B Good X 5 15 Good Y a. Which country has absolute advantage in which good? Why? b. Which country has comparative advantage in which good? Why? c. What is the...
When a country has a comparative advantage in the production ofa good, it means that...
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 Candonia and Sylvania. Both countries produce lemons and
coffee, each initially (i.e., before specialization and trade)
producing 18 million pounds of lemons and 9...
7. Assume, for Vietnam, that the domestic price of textiles without international trade is lower than the world price of textiles. This suggests that in the production of textiles, a. Vietnam has a comparative advantage over other countries and Vietnam will import textiles. b. Vietnam has a comparative advantage over other countries and Vietnam will export textiles. c. other countries have a comparative advantage over Vietnam and Vietnam will import textiles d. other countries have a comparative advantage over Vietnam...
QUESTION 9 When a country's imports is greater than its exports, the country is experiencing a Ca. trade balance cb. trade residual c. trade deficit d. trade surplus QUESTION 10 The slop of the production possilbilities frontier is equal to a. The marginal cost of the good measured on the horizontal axis b. The marginal cost of the good measured on the vertical axis c. The opportunity cost of the good measured on the horizontal axis d. The opportunity cost...
International Economic Relations:
Consider the following input-output table, please answer questions a-h. Note that a one word answer is not acceptable. For full credit, you must provide explanation for your answers and show how you arrive at them. Man Hours Required to Produce Unit of Output Country A Country B Good X 5 15 Good Y a. Which country has absolute advantage in which good? Why? b. Which country has comparative advantage in which good? Why? c. What is the...
When a country has a comparative advantage in the production of
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specialize in the production of this good and trade it for other
goods.The following graphs show the production possibilities frontiers
(PPFs) for Candonia and Sylvania. Both countries produce lemons and
coffee, each initially (i.e., before specialization and trade)
producing 18 million pounds of lemons and 9...
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