Answer all questions please i.ii.iii.iv.V.vi.vii.(b) The following table illustrates the maximum output in the production of Lumber and Wheatfor USA and Guyana; assume that only one good is being produced.USAGuyanaWheatLumberLumber =0, Wheat = 900Lumber =300, Wheat = 0Lumber 0, Wheat = 1000Lumber=200, Wheat = 0Which country has the absolute advantage in wheat production?.Which country has the absolute advantage in Lumber production? _What is the opportunity cost of one more unit of Lumber in Country AWhat is the opportunity cost of one more unit of Lumber in Country BWhat country has the comparative advantage in Wheat production?What country has the comparative advantage in Lumber production? 2What is the acceptable term of trade for which both countries will gain from trade

Step 1: i. The country with the absolute advantage in wheat production is the one that can produce…

Answered: i. ii. iii. iv. V. vi. vii. (b) The…

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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Similar questions

Brazil can produce 100 pounds of beef or 10 autos. In contrast the United States can produce 40 pounds of beef or 30 autos. Which country has the absolute advantage in beef? Which country has the absolute advantage in producing autos? What is the opportunity cost of producing one pound of beef In Brazil? What is the opportunity cost of producing one pound of beef in the United States?
True or False: The source of comparative advantage must be natural elements like climate and mineral deposits. Explain.
In Germany it takes three workers to make one television and four workers to make one video camera. In Poland It takes six workers to make one television and 12 workers to make one video camera. Who has the absolute advantage in the production of televisions? Who has the absolute advantage in the production of video cameras? How can you tell? Calculate the opportunity cost of producing one additional television set in Germany and In Poland. (Your calculation may involve fractions, which Is tine.) Which country has a comparative advantage in the production of televisions? Calculate the opportunity cost of producing one video camera in Germany and in Poland. Which country has a comparative advantage in the production of video cameras? In this example, is absolute advantage the same as comparative advantage, or not? In what product should Germany specialize? In what product should Poland specialize?
How does comparative advantage lead to gains from trade?
Why might Belgium, France, Italy, and Sweden have a higher export to GDP ratio than the United States?
Under what conditions does comparative advantage lead to gains from trade?
Table 33.15 shows how the average costs of production for semiconductors (the chips In computer memories) change as the quantity of semiconductors built at that factory increases. Based on these data, sketch a curve with quantity produced on the horizontal axis and average cost of production on the vertical axis. How does the curve illustrate economies of scale? If the equilibrium quantity of semiconductors demanded is 90,000, can this economy take full advantage of economies of scale? What about if quantity demanded is 70,000 semiconductors? 50,000 semiconductors? 30,000 semiconductors? Explain how international trade could make it possible for even a small economy to take full advantage of economies of scale, while also benefiting from competition and the variety offered by several producers.
Can a nations comparative advantage change over time? What factors would make it change?
In France it takes one worker to produce one sweater, and one worker to produce one bottle of wine. In Tunisia it takes two workers to produce one sweater, and three workers to produce one bottle of wine. Who has the absolute advantage in production of sweaters? Who has the absolute advantage in the production of wine? How can you tell?

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