Use the Following to Answer Question(s): Heartland and Soulland

question 58

Multiple Choice

Use the following to answer question(s) : Heartland and Soulland
Suppose that there are only two countries in the world, Heartland and Soulland.The two countries produce only two goods, corn and drill presses.At its current level of production, Heartland must give up production of 1/4 drill press to produce an additional 100 bushels of corn.Soulland must give up 1 drill press to produce an additional 100 bushels of corn.No trade now occurs between the two economies, and both economies are operating on their respective production possibilities frontiers.
-(Exhibit: Heartland and Soulland) The country with a comparative advantage in the production of drill presses is:

• A) Heartland.
• B) Soulland.
• C) neither; they both use the same technology.
• D) neither; they both use the same amount of resources.

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Definitions:

Quartile

A type of quantile that divides a rank-ordered dataset into four equal parts.

Standard Normal Variable

A random variable that has a mean of 0 and a standard deviation of 1, following the standard normal distribution.

Standard Normal Curve

The graphical representation of a normal distribution that has a mean of zero and a standard deviation of one, used in probability theory and statistics.

Z-score

A statistical measure representing the number of standard deviations a data point is from the mean.