If Korea Is Capable of Producing Either Shoes or Soccer

question 108

Multiple Choice

If Korea is capable of producing either shoes or soccer balls or some combination of the two,then

• A)Korea should specialize in the product in which it has an absolute advantage.
• B)it would be impossible for Korea to have an absolute advantage over another country in both products.
• C)it would be difficult for Korea to benefit from trade with another country if Korea is efficient in the production of both goods.
• D)Korea's opportunity cost of shoes is the inverse of its opportunity cost of soccer balls.

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Definitions:

Volume Variance

A measure of the difference between the expected (budgeted) volume of sales or production and the actual volume, used in cost accounting and financial analysis.

Budget Variance

The difference between the budgeted or planned financial activity and the actual financial performance.

Volume Variance

The difference between the expected amount of output at the standard cost and the actual amount produced, measured at the standard cost.

Direct Labor-Hours

A measure of the total hours worked directly on the production of goods.