Econ Problem Set 04 - Problem Set 04 Econ 103 Macroeconomic...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Problem Set 04 page 1/4 Econ 103 – Macroeconomic Principles Fall 2010 Multiple-choice questions Identify the letter of the choice that best completes the statement or answers the question. 1. Having an absolute advantage in the production of a good implies that a country A) should specialize in the production of the good B) is able to produce the good with fewer resources than another country C) should not specialize in the production of the good D) also has the comparative advantage in the production of the good E) cannot have an absolute advantage in the production of the good 2. Having a comparative advantage in the production of a good implies that a country A) should specialize in the production of the good B) is able to produce the good with fewer resources than another country C) should not specialize in the production of the good D) also has the absolute advantage in the production of the good E) cannot have an absolute advantage in the production of the good Table 1 Tobacco Sugar Razil 20 40 Uba 30 60 3. Table 1 shows Razil's and Uba's production costs in terms of labor-hours per ton. Which of the following would be true? A) Uba has the comparative advantage in the production of both sugar and tobacco. B) Razil has the comparative advantage in the production of both sugar and tobacco. C) Uba has the absolute advantage in the production of both sugar and tobacco. D) There are no gains from trade for both Razil and Uba. E) Uba has the comparative advantage in the production of sugar. 4. Table 1 shows Razil's and Uba's production costs in terms of labor-hours per ton. Which of the following is true? A) Uba has the comparative advantage in the production of both sugar and tobacco. B) Razil has the comparative advantage in the production of both sugar and tobacco. C) Razil has the absolute advantage in the production of both sugar and tobacco. D)
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 4

Econ Problem Set 04 - Problem Set 04 Econ 103 Macroeconomic...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online