Canada produces MP3 players and lumber, and the marginal costs for the two products are $200 per 1,000 board-feet of lumber and $100 per MP3 player
China also produces these goods, and the marginal costs are $300 per 1,000 board-feet of lumber and $100 per MP3 player. Which country has the comparative advantage in lumber production? A) Canada
B) China
C) Both countries share the comparative advantage.
D) We need more information to answer this question.
A
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The law of demand holds that as prices of goods decrease, people are willing to buy more
a. True b. False Indicate whether the statement is true or false
One of the Ten Principles of Economics in Chapter 1 is that people face tradeoffs. The growth that arises from capital accumulation is not a free lunch. It requires that society
a. conserve resources for future generations. b. sacrifice consumption goods and services now in order to enjoy more consumption in the future. c. recycle resources so that future generations can produce goods and services with the accumulated capital. d. None of the above is correct.
If a country's Gini coefficient had a value of one, this means:
a. the country has a perfectly even distribution of income. b. income is fairly evenly distributed across the country. c. income is fairly uneven across the country. d. all the income in the country goes to one person.
Efficient markets theory suggests that purchasing the published reports of financial analysts
A. is not likely to increase financial returns. B. is likely to increase one's returns by an average of 5 percent. C. will increase financial returns in the first year but not in following years. D. is likely to increase one's returns by an average of about 3 to 5 percent.