Given the Following Ricardo-Type Table Showing the Amount of Labor

question 22

Multiple Choice

Given the following Ricardo-type table showing the amount of labor input required to produce one unit of output of each of the two goods in each of the two countries:
$\begin{array}{lll}&\underline{\text { Wheat }}&\underline{\text { Clothing }}\\\text { United Kingdom } & 6 \text { days } & 5 \text { days } \\\text { United States } & 4 \text { days } & 3 \text { days }\end{array}$

• A) The United Kingdom has an absolute advantage in neither good.
• B) The United States has a comparative advantage in wheat.
• C) The United States has a comparative advantage in both goods.
• D) A post-trade price ratio (terms of trade) of 1 wheat:1.5 clothing is a feasible
• Equilibrium post-trade price ratio.

---

Definitions:

Dividends Payable

A liability recorded on the company's balance sheet representing the amount of declared dividends that are owed to shareholders but have not yet been paid.

Financial Statements

Structured reports that detail the financial activities and conditions of a business, including the balance sheet, income statement, and cash flow statement.

Goodwill

An intangible asset that arises when a business is acquired for more than the fair value of its net identifiable assets.

Intangible Asset

An asset that lacks physical substance, such as intellectual property or brand recognition.