Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The table below represents the maximum amount of Rice or Motorcycles, the United States and Japan could produce in one hour of labor time if
The table below represents the maximum amount of Rice or Motorcycles, the United States and Japan could produce in one hour of labor time if they each specialized entirely in one good or the other. So the US could produce either 500 bushels of rice or 150 motorcycles while Japan could produce either 400 bushels of rice or 80 motorcycles RICE MOTORCYCLES USA 500 bushels 150 JAPAN 400 bushels 80 Assume the US and Japan both operate on straight-line production possibilities curves. Which one should specialize in producing Rice? Why? (2 points) (I suggest one or two sentences- use your calculations to help you to explain your answer) If the country producing Rice charges 0.4 motorcycles per bushel of rice, will the exchange occur? Explain. (2 points) (I suggest one or two sentences- use your calculations to help you to explain your answer) Explain your answers to receive full credit. I suggest you spend ten minutes on this question. Hint: calculate the opportunity cost for one bushel of rice
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started