For this question, only consider Korea and the United States. If the United States is better at producing agricultural goods and technological goods, then It would be impossible for the United States to benefit from trade with Korea since the United States have an absolute advantage in the production of both good A. ? OB. It would be impossible for the United States to have an absolute advantage over another country in the production of both products. OC. The United States should specialize in the production of technological goods if Korea has a comparative advantage in the production of agricultural goods. The United States should specialize in the product in which it has an absolute advantage. OD.

For this question, only consider Korea and the United States. If the United States is better at producing agricultural goods and technological goods, then It would be impossible for the United States to benefit from trade with Korea since the United States have an absolute advantage in the production of both good A. ? OB. It would be impossible for the United States to have an absolute advantage over another country in the production of both products. OC. The United States should specialize in the production of technological goods if Korea has a comparative advantage in the production of agricultural goods. The United States should specialize in the product in which it has an absolute advantage. OD.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter33: International Trade

Section: Chapter Questions

Problem 2SCQ: Brazil can produce 100 pounds of beef or 10 autos. In contrast the United States can produce 40...

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.Brazil can produce 100 pounds of beef or 10 autos; in contrast the United States can produce 40pounds of beef or 30 autos. Which country has the absolute advantage in beef? Which country has theabsolute advantage in producing autos? What is the opportunity cost of producing one pound of beef inBrazil? What is the opportunity cost of producing one pound of beef in the United States?
21. According to David Ricardo, O A. If countries specialize where they have a comparative advantage and trade, all groups in their economies will benefit equaly OB. If countries specialize where they have a comparative advantage and trade, their efficiency and standard of living can improve O C. If countries specialize where they have an absolute advantage and trade, their efficiency and standard of living can improve O D. Countries should strive to develop their absolute advantage to benefit from trade with other countries
According to David Ricardo, O A. If countries specialize where they have an absolute advantage and trade, their efficiency and standard of living can improve O B. Countries should strive to develop their absolute advantage to benefit from trade with other countries O C. If countries specialize where they have a comparative advantage and trade, all groups in their economies will benefit equaly OD. If countries specialize where they have a comparative advantage and trade, their efficiency and standard of living can improve
If all countries follow a policy of free trade, economists predict that O a. each country will export goods at which it has a comparative advantage at producing and import goods at which it has a comparative disadvantage at producing Ob each country will export goods at which it has a comparative disadvantage at producing and import goods at which it has a comparative advantage at producing Oc there will be no trade between countries - that is, no international trade taking place Od rich countries will be made poorer by trade with poor countries O e. poor countries will be made even poorer by trade with rich countries
. Which country has an absolute advantage in the production of fruit? Which countryhas an absolute advantage in the production of timber?b. Which country has a comparative advantage in the production of fruit? of timber?c. Sketch the PPF’s for both countries.d. Assuming no trading between the two, if both countries wanted to have equalnumbers of feet of timber and baskets of fruit, how would they allocate workers tothe two sectors?e. Show that specialization and trade can move both countries beyond their PPF’s.
Two countries, Korea and Vietnam, are engaging in international trade.They produce two goods: automobiles and cloth. We observe a relativeabundance of cheap labor in Vietnam and a relative abundance of capitalin South Korea. a. Assume that automobiles are capital-intensive and cloth are cheaplabor-intensive. Using the Hecksher-Ohlin theory, explain what willhappen in trade between these two countries, in terms of export andimport. c. Draw a graph that shows the above situation in South Korean economy with a P P F and two relative prices (one before trade and theother after trade). The quantity of automobiles (QAuto) is on thehorizontal axis and the quantity of cloth (QCloth) is on the verticalaxis.
Suppose the government has imposed a price ceiling on cellular phones. Which of the following events could transform the price ceiling from one that is binding to one that is not binding? Select one: O a. Traditional land line phones become more expensive. O b. Cellular phones become more popular. O. A technological advance makes cellular phone production less expensive. O d. The components used to produce cellular phones become more expensive.
If United States has a comparative advantage over Japan in the production of cars, then. O the opportunity cost of producing cars in United States is lower than in Japan. the opportunity cost of producing cars in United States is higher than in Japan. O only United States will gain from specialization and trade in cars between United States and Japan. O there are no gains from specialization and trade in cars between United States and Japan.
7. Nations conduct international trade because: а. Some nations prefer to produce one thing while others produce other things. b. Trade enhances opportunities in all trading nations C. Interest rates are not identical in all trading nations. O d. Resources are not equally distributed among all trading nations.
Argentina can produce 150 pounds of beef or 20 cars; in contrast the United States can produce 90 pounds of beef or 80 cars. Which country has the absolute advantage in producing beef? O Both countries have an absolute advantage. O United States O Argentina O Neither country has an absolute advantage.
In theory of comparative advantage, which statement is correct O a a country should produce all product in which it is efficient O b. a country should produce all goods to cater its domestic demand Oo a country should only produce those goods in which it is more efficient than other goods Kd a country should produce all products it can export
Assume that Japan and Korea can switch between producing cars and producing airplanes at a constant rate. Japan Korea Hours Needed to Make 1 Car 30 50 Airplane 150 150 Refer to Table 3-26. Japan has an absolute advantage in the production of O a. cars and a comparative advantage in the production of airplanes. b. neither good and a comparative advantage in the production of cars. Oc. neither good and a comparative advantage in the production of airplanes. O d. cars and a comparative advantage in the production of cars. Quantity Produced in 2400 Hours Cars 80 48 Airplanes 16 16