Table 2-12 Table 2-12 Shows the Number of Labor Hours

question 53

Multiple Choice

Table 2-12
Table 2-12 shows the number of labor hours required to produce a canoe and a sailboat in Guatemala and Honduras.
-Refer to Table 2-12. Does either Guatemala or Honduras have an absolute advantage and if so, in what product?

• A) Guatemala only has an absolute advantage in producing canoes.
• B) Honduras only has an absolute advantage in producing canoes.
• C) Guatemala has an absolute advantage in producing both products.
• D) Honduras only has an absolute advantage in producing sailboats.

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Definitions:

Agricultural Adjustment Act

A United States federal law of the New Deal era designed to boost agricultural prices by reducing surpluses.

Price Supports

Government interventions to hold the price of a commodity above market levels, usually to support the income of producers.

Sugar

A sweet-tasting, soluble carbohydrate used commonly as a sweetener in food and drinks.

Trade Barriers

Any regulation or policy that restricts international trade, including tariffs, quotas, and non-tariff barriers, aimed at protecting domestic industries.