Homework Answers
a.Dave has a comparative advantage in icecream as he can produce 8 and Sam can produce 5 at the same given time.
Dave also has an absolute advantage in cake as he can produce 4 while Sam 2 at the same given time.
b.Sam has a comparative advantage in icecream as for each cake he gives up he can produce 2.5 icecream but Dave can produce only 2 for giving up each cake.
Dave has a comparative advantage in cake, as each cake can be produced by giving up two icecreams but Sam has to give up 2.5.
c.Dave would produce 4 cakes and Sam would produce 5 icecreams.Therefore total production= 4 cakes and 5 icecream.
d.Dave offering 1 cake for 2.5 icecreams or 2 cakes for 5 icecreams would make dave unambiguously better off while still being acceptable to Sam
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The production possibilities frontiers below show how much Dave and Sam can each produce in 8...
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only answer parts 3-9!! thanks Below, you are provided with Esteban's and Irene's Production Possibilities Frontiers...
only answer parts 3-9!! thanks
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than its trading partner. Because of this comparative advantage,
both countries benefit when they specialize and trade with each
other.
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only answer parts 3-9!! thanks
Below, you are provided with Esteban's and Irene's Production Possibilities Frontiers between chicken empanadas and beef empanadas. You will use these PPFs to identify the opportunity cost of producing an additional empanada of each type for both individuals, to determine which individual has an absolute advantage in the production of each type of empanada, and to determine which individual has a comparative advantage in the production of each type of empanada. Part 1: Complete the...
S. (8) The following are the Production possibility frontiers of the U.S. and Germany The U.S Airplanes Cars Airplanes Germany Cars 10 10 a. Draw the PPF for two countries with airplanes on the vertical axis lane (in terms of cars) in the U.S.? (For this, What is the opportunity cost of each additional airp first think about how many cars they should give up to get 2 additional airplanes. And then, divide that number by 2 to see how...
When a country specializes in the production of a good, this
means that it can produce this good at a lower opportunity cost
than its trading partner. Because of this comparative advantage,
both countries benefit when they specialize and trade with each
other.
The following graphs show the production possibilities frontiers
(PPFs) for Candonia and Lamponia. Both countries produce lemons and
tea, each initially (i.e., before specialization and trade)
producing 6 million pounds of lemons and 3 million pounds of...
Global PPF and Inereasing Oppertunity Costs The countries of England and Ihaly have the production possibilities tables for sheep and hogs s the costs of prodocing sheep and hogs England's PRODUC TION POSSIBILITIES TABLE are constant in both countries. Assume there are only two countries in the world. itary's PROOUCTION POSSIBILITIES TABLE Aernelv 25 20 15 t0 Sheep Hogs 20 16 12 840 Hogs Taxk 8: If both England and Italy were to produce only sheep, how many sheep would...
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