Use the Following Scenario to Answer the Following Questions

question 58

Multiple Choice

Use the following scenario to answer the following questions:
Karl and Jager produce cars and trucks.Karl can produce 10 cars per hour or 5 trucks per hour.Jager can produce 12 cars per hour or 4 trucks per hour.
-Based on the scenario,which of the following is true?

• A) Jager has an absolute advantage in producing cars,but not trucks.
• B) Jager has an absolute advantage in producing trucks,but not cars.
• C) Jager has an absolute advantage in producing both goods.
• D) Jager has an absolute advantage in producing neither good.
• E) Karl has a comparative advantage in producing both goods.

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Definitions:

Sustainable Business Activity

An approach to conducting business that prioritizes environmental conservation, social responsibility, and economic performance.

Crop Rotation

An agricultural technique where different types of crops are planted in the same area in sequenced seasons to improve soil health and reduce pest and disease risk.

Factory Overhead

All indirect costs involved in manufacturing beyond direct materials and direct labor.

Indirect Labor

Labor costs not directly tied to the production of goods or services, such as maintenance, supervision, and administrative staff salaries.