Suppose that Guru and Premier produce only beats and rhymes. Guru can produce at most 400...
Suppose that Guru and Premier produce only beats and rhymes. Guru can produce at most 400 beats or 1000 rhymes in a year. Premier can produce at most 100 beats or 200 rhymes in a year. Use the principle of comparative advantage (and maybe PPFs for the two musicians) to determine who should specialize in which activity.
Homework Answers
Guru's opportunity cost of producing beats = 1000/400= 2.5 rhymes
Premier's opportunity cost of producing beats = 200/100= 2 rhymes
Guru specializes in producing rhymes and Premier specializes in producing beats
Add Answer to:
Suppose that Guru and Premier produce only beats and
rhymes. Guru can produce at most 400...
1. Suppose country A can produce 30 units of Corn per time period (if it specializes...
1. Suppose country A can produce 30 units of Corn per time period (if it specializes in Corn). Country A can produce 4 outfits per time period (if it specializes in outfits). If country B specializes in Corn, it can produce 40 units per time period. If country B specialized in Outfits, it can produce 3 outfits per time period. A has a comparative advantage in Corn. B has a comparative advantage in Outfits. neither country has a comparative advantage....
Q1: Q2: Suppose that a worker in Country A can produce either 25 bananas or 5...
Q1:
Q2:
Suppose that a worker in Country A can produce either 25 bananas or 5 tomatoes each year. Country A has 200 workers. Suppose a worker in Country B can produce either 18 bananas or 6 tomatoes each year. Country B has 400 workers. The workers in Country B will benefit from trade if they: Multiple Choice specialize in bananas because they have a comparative advantage in banana production. O specialize in tomatoes because their opportunity cost of tomatoes...
Comparative Advantage Assuming constant opportunity costs, suppose Mickey can produce either 800 cheese and 0 crackers,...
Comparative Advantage Assuming constant opportunity costs, suppose Mickey can produce either 800 cheese and 0 crackers, or 0 cheese and 200 crackers; and Minnie can produce either 150 cheese and 0 crackers, or 0 cheese and 450 crackers. State who has a comparative advantage in cheese. Explain why. (5 points) Without trade Mickey produces 400 cheese and 100 crackers, and Minnie produces 100 cheese and 150 crackers. If the terms of trade are 1 deese 1 cracker, what are the...
Suppose that France and Germany both produce schnitzel and wine. The following table shows combination of...
Suppose that France and Germany both produce schnitzel and wine. The following table shows combination of the goods that each country can produce in a day 2. France Germany Wine Schnitzel Wine Schnitzel bottles)(pounds) (bottles)(pounds) 15 12 Who has comparative advantage in producing wine? Who has the comparative advantage in producing schnitzel? Explain Suppose France is currently producing 1 bottle of wine and 6 pounds of schnitzel, and Germany is currently producing 3 bottles of wine and 6 pounds of...
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16 Which of the following would shift the U.S. PPF outward, ceteris paribus? An increase in...
16 Which of the following would shift the U.S. PPF outward, ceteris paribus? An increase in capital. An income tax cut for consumers. A decrease in education (human capital). All of the above would cause outward shifts of the U.S. PPF. The development and use of a new production technology in Canada. 19 According to the Law of Comparative Advantage, if two countries specialize in the production of the good in which they have a comparative advantage, then all goods...
Suppose that France and Gernany both produce wine and schrel The tabk belaw shows combinations of...
Suppose that France and Gernany both produce wine and schrel The tabk belaw shows combinations of the gaots that each country can produce in a day France Germany Wine (Bottles) Schnitzel (Pounds) Winc (Bottles 20 16 Who has the comparative advatage in producing wine arid wha has the comparative advantage in producing schrilzel? O A. France has a comparative advantage producing schnitzel and Germany has a comparative advantage producing wine. ā France has a comparatns advantage producing wine and Germany...
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 Maldonia and Desonia. Both countries produce potatoes and tea, each initially (i.el, before specialization and trade) producing 24 million pounds of...
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...
suppose the united states is currently producing 200 tons of hamburgers and 90 tons of tacos mexico is cutrently produc...
suppose the united states is currently producing 200 tons of
hamburgers and 90 tons of tacos mexico is cutrently producing 20
tons of hamburgers and 50 tons of tacoes if the united states and
mexico each specialize in producing only one good the good for
which each has a comparitive advantage then a toal of ? additional
tons of hamburgers can be produced for the two countries combines
and a total of ? additional tons of tacoes can be produced...
Q1:
Q2:
Suppose that a worker in Country A can produce either 25 bananas or 5 tomatoes each year. Country A has 200 workers. Suppose a worker in Country B can produce either 18 bananas or 6 tomatoes each year. Country B has 400 workers. The workers in Country B will benefit from trade if they: Multiple Choice specialize in bananas because they have a comparative advantage in banana production. O specialize in tomatoes because their opportunity cost of tomatoes...
Comparative Advantage Assuming constant opportunity costs, suppose Mickey can produce either 800 cheese and 0 crackers, or 0 cheese and 200 crackers; and Minnie can produce either 150 cheese and 0 crackers, or 0 cheese and 450 crackers. State who has a comparative advantage in cheese. Explain why. (5 points) Without trade Mickey produces 400 cheese and 100 crackers, and Minnie produces 100 cheese and 150 crackers. If the terms of trade are 1 deese 1 cracker, what are the...
Suppose that France and Germany both produce schnitzel and wine. The following table shows combination of the goods that each country can produce in a day 2. France Germany Wine Schnitzel Wine Schnitzel bottles)(pounds) (bottles)(pounds) 15 12 Who has comparative advantage in producing wine? Who has the comparative advantage in producing schnitzel? Explain Suppose France is currently producing 1 bottle of wine and 6 pounds of schnitzel, and Germany is currently producing 3 bottles of wine and 6 pounds of...
10) Suppose the US and Mexico both can produce cars and beer. The following chart shows what 100 workers can produce in one day in each country. Country Car Production-100 Beer Production (truckload)- 100 or workers workers United States 300 or 1200 Mexico 200 1000 or For this question, assume they can use the same workers to produce any amount in between the two and the opportunity cost is constant straight PPF a) Use the info in the table to...
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suppose the united states is currently producing 200 tons of
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tons of hamburgers and 50 tons of tacoes if the united states and
mexico each specialize in producing only one good the good for
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tons of hamburgers can be produced for the two countries combines
and a total of ? additional tons of tacoes can be produced...
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