24.The table below presents the number of workers it takes to produce 10 Headphones and 10 Tablets in the countries of Greatstown and Minitown.Country Headphones (workers per 10 units) Tablets (workers per 10 units)Greatstown42Minitown7.18.1Does Minitown have a comparative advantage in the production of Headphones?OYesONODoes Minitown have a comparative advantage in the production of Tablets?OYesONODoes Minitown export Headphones?Olt should export HeadphonesOlt should export TabletsOlt should not trad

Comparative advantage refers to the ability of the country to produce the good at a lower…

24. The table below presents the number of workers it takes to produce 10 Headphones and 10 Tablets in the countries of Greatstown and Minitown. Country Headphones (workers per 10 units) Tablets (workers per 10 units) Greatstown 4 Minitown 7.1 Does Minitown have a comparative advantage in the production of Headphones? OYes ONO Does Minitown have a comparative advantage in the production of Tablets? OYes ONO Does Minitown export Headphones? Olt should export Headphones Olt should export Tablets Olt should not trade. 2 8.1

24. The table below presents the number of workers it takes to produce 10 Headphones and 10 Tablets in the countries of Greatstown and Minitown. Country Headphones (workers per 10 units) Tablets (workers per 10 units) Greatstown 4 Minitown 7.1 Does Minitown have a comparative advantage in the production of Headphones? OYes ONO Does Minitown have a comparative advantage in the production of Tablets? OYes ONO Does Minitown export Headphones? Olt should export Headphones Olt should export Tablets Olt should not trade. 2 8.1

Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781305971509

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter9: Application: International Trade

Section: Chapter Questions

Problem 1CQQ

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Similar questions

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.
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?
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?
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How does comparative advantage lead to gains from trade?