Problem Set 2

Problem Set 2 - Cornell University Gregory Besharov...

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Cornell University Gregory Besharov Economics 3610: Problem Set 2 Due September 15, 2008 1. True/False/Explain. For each of the following statements, say whether the statement is true or false and explain your answer. Please limit your answer to two sentences. a. If a country has a comparative advantage in producing a good, it must also have an absolute advantage in producing that good. b. In a world with two countries and two goods, if a country has an absolute advantage in one good, it must have a comparative advantage in that good as well. c. From just the graphs of the production possibilities frontiers of two countries that each produce two goods, one can tell which has a comparative advantage in producing each good. d. From just the graphs of the production possibilities frontiers of two countries that each produce two goods, one can tell which has an absolute advantage in producing each good. 2.
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This note was uploaded on 10/12/2008 for the course ECON 361 taught by Professor Besh during the Fall '08 term at Cornell.

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Problem Set 2 - Cornell University Gregory Besharov...

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