When is there no way that two people can trade and both be better off. For this to happen, their PPFs must be
A. Identical
B. Parallel
C. Opposite
D. Trading is always mutually benefical
"A"
if the PPF are identical and they have the same consumption then the nations cannot trade for example tow nations producing only cheese and milk, and consuming them. they will need different production capability or comparative advantage to trade between each other.
When is there no way that two people can trade and both be better off. For this...
With trade, the production possibilities for two nations lie a. outside their consumption possibilities. b. inside their consumption possibilities. c. at a point equal to the world production possibilities curve. d. None of the answers above are correct. 4) Free-trade theory suggests that when trade takes place a. both nations will be worse off. b. one nation must gain at the other nation’s expense. c. both nations are better off. d. one nation will gain and the other nation will...
Question 4: Consider two countries A & B with the following PPF's for production of cookies (C) and milk (M): Country A: C-100-5M Country B: C-20-0.5M Part A: In two separate graphs with C on the Y-axis and M on the X-axis, graph both PPFs. Part B: Determine which country has an absolute advantage in milk production. Part C: Determine which country has a comparative advantage in milk production. Part D: If the countries decide to trade, which good will...
(10 points) Consider a simple exchange economy with two people: Bob and Jake. Bob and Jake both have ten hours of time available. The can use their time to do one of two things: make pancakes or make hamburgers. Bob can make four hamburgers in an hour or one pancake in an hour. Jake can make two pancakes in an hour or one hamburgers in an hour. a.) Draw Bob and Jake's PPFs with hamburgers on the x-axis. Give equations...
A quota A. makes domestic consumers better off. B. makes both domestic producers and consumers better off. C. makes everyone worse off. D. makes domestic producers better off.
1. (Endowment Economies) When will countries trade? Assuming 2 goods, food and clothing, and two countries with homothetic preferences, determine whether these two countries will trade in each of the following situations (a) Countries have identical preferences and identical endowments (b) Countries have identical preferences, their endowments differ, and their endow- ments are not in the same ratio of food to clothing (c) Countries have identical preferences, their endowments differ, but the ratio of food to clothin is the same...
Every year, the Gallup poll asks a sample of people in the United States whether they believe foreign trade provides "an opportunity for economic growth through increased U.S. exports," or whether they believe foreign trade represents "a threat to the economy from foreign imports." The table shows the responses for two years. View of foreign trade Year Favorable to foreign trade Unfavorable to foreign trade State of the U.S. economy 2008 41% 52% Deep economic recession 2017 72% 23% Economic...
1) When trade in coffee is allowed, producer surplus in
Guatemala
a. increases by the area B + D.
b. increasesbytheareaB+D+G.
c. decreases by the area C + F.
d. decreases by the area G.
2) When trade is allowed,
a. Guatemalan producers of coffee become better off and
Guatemalan consumers of coffee become worse off.
b. Guatemalan consumers of coffee become better off and
Guatemalan producers of coffee become worse off.
c. both Guatemalan producers and consumers of coffee...
A two-stage Markov chain consists of ON and OFF. When the system is ON it is always turned off. When the system is OFF it is always turned on. a) Draw the Markov Chain b) Create the transition matrix, call it P. c) Find P2 d) Find P3 e) Considering what P2 and P3 are, explain to me like I am an idiot why the Limit Distribution can't exist. f) Find the Stationary Distribution
Tom and Jerry are two severely competitive rivals who like both milk and cheese. Their weekly production possibilities are shown in the following table. Choices Tom Jerry Milk Cheese Milk Cheese Choice A 50oz 0 24oz 0 Choice B 0 10oz 0 8oz Who has absolute advantage in Milk? Why? Who has absolute advantage in Cheese? Why? Who has comparative advantage in Milk? Why? Who has comparative advantage in Cheese? Why Draw Tom PPC [keep cheese on the x axis...
please complete all of number 7.
it make people better off? QUESTIONS you and for other people in a worla 1. What is meant by the Invisible Hand"? How can it maken 2. What kind of economy would exist for you and for on without scarcity? Would you want or have a job in such a world ring the basic economic 3. Can scarcity and affluence exist at the same time for thes (4.lvhy must all economies devise a means...