Solved

Consider the Following Information About the Production of Two Goods,X

Question 77

Multiple Choice

Consider the following information about the production of two goods,X and Y,in two countries,A and B:
∙ In Country A it takes Xa units of resources to produce one unit of X and Ya units of resources to produce one unit of Y.
∙ In Country B it takes Xb units of resources to produce one unit of X and Yb units of resources to produce one unit of Y.
∙ Assume the amount of resources used to produce the goods in the two countries can be compared unambiguously.
-Refer to Table 32-1.If Consider the following information about the production of two goods,X and Y,in two countries,A and B: ∙ In Country A it takes X<sub>a</sub> units of resources to produce one unit of X and Y<sub>a</sub> units of resources to produce one unit of Y. ∙ In Country B it takes X<sub>b</sub> units of resources to produce one unit of X and Y<sub>b</sub> units of resources to produce one unit of Y. ∙ Assume the amount of resources used to produce the goods in the two countries can be compared unambiguously. -Refer to Table 32-1.If   is less than   ,we can conclude with certainty that A) The opportunity cost of producing good X in Country A is less than in Country B. B) Country A has a comparative advantage in the production of good X. C) Country A has an absolute advantage in the production of good X. D) The price of good X in Country A is less than the price in Country B. E) The opportunity cost of producing good X in Country A is higher than in Country B. is less than Consider the following information about the production of two goods,X and Y,in two countries,A and B: ∙ In Country A it takes X<sub>a</sub> units of resources to produce one unit of X and Y<sub>a</sub> units of resources to produce one unit of Y. ∙ In Country B it takes X<sub>b</sub> units of resources to produce one unit of X and Y<sub>b</sub> units of resources to produce one unit of Y. ∙ Assume the amount of resources used to produce the goods in the two countries can be compared unambiguously. -Refer to Table 32-1.If   is less than   ,we can conclude with certainty that A) The opportunity cost of producing good X in Country A is less than in Country B. B) Country A has a comparative advantage in the production of good X. C) Country A has an absolute advantage in the production of good X. D) The price of good X in Country A is less than the price in Country B. E) The opportunity cost of producing good X in Country A is higher than in Country B. ,we can conclude with certainty that


A) The opportunity cost of producing good X in Country A is less than in Country B.
B) Country A has a comparative advantage in the production of good X.
C) Country A has an absolute advantage in the production of good X.
D) The price of good X in Country A is less than the price in Country B.
E) The opportunity cost of producing good X in Country A is higher than in Country B.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions