Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Answer the question below.. Question 1 The following table shows the production of cars and radios in Countries A and B. Countries Cars (units) Radios

image text in transcribed

Answer the question below..

image text in transcribedimage text in transcribedimage text in transcribed
Question 1 The following table shows the production of cars and radios in Countries A and B. Countries Cars (units) Radios (units) A 80 100 B 60 60 a) Which country has an absolute advantage in the production of cars and radios? b) Which country has the comparative advantage in the production of car and radios? c) According to the principle of comparative advantage, which country should specialize in producing car and radio? d) Construct the table after specialization. e) With the assumption of complete specialization after trade, what is the term of trade for both countries?Question 2 The following table shows the output of coca and rubber that is produced by two countries. Countries Cocoa (ton) Rubber (ton) Indonesia 550 2,000 Vietnam 1,100 750 Suppose that resource are divided equally between the two productions. a) Which country has an absolute advantage in production of cocoa? b) Calculate the opportunity cost of producing one ton of cocoa and ton of rubber in each country? c) Which country has the comparative advantage of producing cocoa and rubber? d) Construct the output table after specialization.Question 3 Based on Table 3, answer the following questions:- Table 3: The Production of Watches and Shoes Country Watches Shoes China 5,000 500 Uganda 1,000 2,200 a. Which country has an absolute advantage in both line of production? Why ? I b. Calculate the opportunity cost to produce watches and shoes for both countries. C. Based on the comparative advantage theory, state the line of specialization for each country and construct the table after specialization. d. Suggest a term of trade that will benefit both countries. e. List THREE (3) benefits for implementation international trade

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Dynamic Business Law

Authors: Nancy Kubasek

1st Edition

0073524913, 9780073524917

More Books

Students also viewed these Economics questions

Question

Outline two major problems for psychogenic identity theory.

Answered: 1 week ago

Question

factor ( 3 x 2 - 5 x - 5 0

Answered: 1 week ago