Suppose an American worker can make 20 pairs of shoes or grow 100 apples per day. On the other hand, a Canadian worker can produce 10 pairs of shoes or grow 20 apples per day. Which of the following statements is true?
A. The United States has a comparative advantage in the production of shoes.
B. Canada has a comparative advantage in the production of shoes.
C. Comparative advantage doesn't exist in this scenario.
D. Both countries have a comparative advantage in the production of shoes.
B. Canada has a comparative advantage in the production of shoes.
You might also like to view...
A firm that responds to a regulatory rule in a way that permits technical compliance while allowing the firm to violate the spirit of the regulation has
A) reduced the scope of the lemons problem. B) shared the gains and pains of regulation. C) engaged in a creative response to regulation. D) become a captured regulator.
When a tax is levied on the sellers of a good, the
a. supply curve shifts upward by the amount of the tax. b. quantity demanded decreases for all conceivable prices of the good. c. quantity supplied increases for all conceivable prices of the good. d. None of the above is correct.
An open-market sale
a. increases the number of dollars and the number of bonds in the hands of the public. b. increases the number of dollars in the hands of the public and decreases the number of bonds in the hands of the public. c. decreases the number of dollars and the number of bonds in the hands of the public. d. decreases the number of dollars in the hands of the public and increases the number of bonds in the hands of the public.
India and China are
A. LDCs. B. NICs. C. industrialized countries.