Suppose that a worker in Country A can make either 10 iPods or 5 tablets each year. Country A has 100 workers. Suppose a worker in Country B can make either 2 iPods or 10 tablets each year. Country B has 200 workers. Which of the following is true?
A. Country B should produce tablets and Country A should produce iPods, and they could benefit from trade.
B. Country B should produce iPods and Country A should produce tablets, and they could benefit from trade.
C. Neither country can benefit from trade since no comparative advantage exists.
D. Because Country B has the absolute advantage in producing tablets, they should specialize in the production of tablets.
A. Country B should produce tablets and Country A should produce iPods, and they could benefit from trade.
You might also like to view...
Special Drawing Rights are financial assets created by
(a) the World Bank. (b) the United National Development Program. (c) multinational corporations. (d) the International Monetary Fund.
Which economic concept is the closest to the saying, "There's no such thing as a free lunch"?
a. Specialization b. Unlimited wants c. Underutilization of resources d. Opportunity costs e. Overutilization of resources
U.S. immigrants are less likely to be working than immigrants in other developed countries
a. True b. False Indicate whether the statement is true or false
If the industry in the above figure was perfectly competitive, the level of output would
A) be less than the single-price monopoly level of output.
B) be the same as the single-price monopoly level of output.
C) exceed the single-price monopoly level of output by 20 units per day.
D) exceed the single-price monopoly level of output by 60 units per day.