Assume two nations: Vietnam and US, and two commodities: clothing and wheat. There is only one factor of production: labour. The following table presents the number of hours it takes to produce one unit of the good in each nation: US Vietnam 6 hours Wheat 5 hours Clothing 4 hours 8 hours 1. The relative price of clothing in the US is... a) 5/8 kg of wheat b) 8/5 yards of clothing c) 8/5 kg of wheat d) 5/8 yards of clothing 2. If US and Vietnam were to trade, the relative price of wheat... a) Can be 2 yards of clothing b) Must be between 5/8 and 1.5 yards of clothing c) Must be between 2/3 and 1.6 yards of clothing d) Can be ½ yards of clothing.

Assume two nations: Vietnam and US, and two commodities: clothing and wheat. There is only one factor of production: labour. The following table presents the number of hours it takes to produce one unit of the good in each nation: US Vietnam 6 hours Wheat 5 hours Clothing 4 hours 8 hours 1. The relative price of clothing in the US is... a) 5/8 kg of wheat b) 8/5 yards of clothing c) 8/5 kg of wheat d) 5/8 yards of clothing 2. If US and Vietnam were to trade, the relative price of wheat... a) Can be 2 yards of clothing b) Must be between 5/8 and 1.5 yards of clothing c) Must be between 2/3 and 1.6 yards of clothing d) Can be ½ yards of clothing.

Name: CHOOSE ONLY ONE OPTION FROM EACH PLEASE. Be aware that the numbers in
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Description: CHOOSE ONLY ONE OPTION FROM EACH PLEASE. Be aware that the numbers in the table reveal the labour HOURS needed to produce ONE unit of the good. Assume two nations: Vietnam and US, and two commodities: clothing and wheat.There is only one factor of pr

MACROECONOMICS

14th Edition

ISBN:9781337794985

Author:Baumol

Publisher:Baumol

Chapter18: International Trade And Comparative Advantage

Section: Chapter Questions

Problem 2TY

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