(Table) from the Table, Assume That Canada Can Produce Both $\text {Canada's Production Possibilities}$

question 78

Multiple Choice

(Table) From the table, assume that Canada can produce both timber and oil at an absolute advantage compared to Mexico, yet Canada is willing to trade its timber for Mexican oil. Why might Canada be willing to focus on timber and allow Mexico to produce oil? $\text {Canada's Production Possibilities}$
$\begin{array}{cc} \text { Tons of Timber}& \text {Barrels of }\\& \text {Oil}\\15 & 0 \\ 10 & 4 \\ 5 & 8 \\ 0 & 12\end{array}$



$\text {Mexico's Production Possibilities}$
$\begin{array}{cc} \text {Tons of Timber}&\text { Barrels of}\\&\text { Oil}\\6 & 0 \\ 4 & 2 \\ 2 & 4 \\ 0 & 6\end{array}$

• A) Mexico has better trade routes north to Canada.
• B) Canada sees this tradeoff as a form of charity.
• C) Comparative advantage allows both countries to specialize in the items for which they have the lowest opportunity cost and allows for mutual benefits.
• D) Canada is hoping to tax the oil heavily as it is imported.

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Definitions:

Scientific Observation

The systematic process of gathering empirical data through the use of controlled and repeatable methods, crucial for scientific inquiry and hypothesis testing.

Quantitative Measurement

The process of obtaining and evaluating numerical data to describe attributes of a phenomenon.

Decision Complexity

Refers to the level of difficulty involved in making a decision, often due to multiple variables, uncertainty, and potential consequences.

Nutritional and Dietary Requirements

The specific nutrient intake and dietary guidelines necessary to maintain health, often based on an individual's age, gender, and health status.