In a Single Year, the Netherlands Can Raise 100 Tons

question 50

Essay

In a single year, the Netherlands can raise 100 tons of beef or produce 1,000 boxes of tulips.In the same growing season, Belgium can raise 50 tons of beef or produce 750 boxes of tulips.In autarky the price of beef:
A.is higher in the Netherlands than in Belgium.
B.is lower in the Netherlands than in Belgium.
C.is the same in the Netherlands as in Belgium.
D.cannot be determined in either country.

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Definitions:

Taxable Income

The amount of income that is used to calculate an individual's or a company’s income tax due, after exemptions and deductions.

Operating Income

Earnings before interest and taxes (EBIT), representing a company's profit from regular operations, excluding non-operational income and expenses.

Retained Earnings

Profits that a company has earned to date, less any dividends or other distributions paid to shareholders.

Dividends

Payments made by a corporation to its shareholder members. It is the portion of corporate profits paid out to stockholders.