The United States Can Produce 30 Computers for Every Car

question 207

Essay

The United States can produce 30 computers for every car it produces, and Japan can produce 15 computers for every car it produces.Based on this information, which of the following statements is incorrect?
A.The United States should specialize in computer production.
B.Japan has the comparative advantage in car production.
C.There will be gains from trade if the United States exports computers to Japan.
D.Japan has an absolute advantage in car production.

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Definitions:

Investment Banking

A sector of the banking industry that helps individuals and organizations raise capital and provides financial consultancy services.

Securities Act of 1933

A U.S. law enacted to ensure greater transparency in financial statements and to reduce fraud and manipulation in the securities markets.

Prospectus

A formal legal document that provides details about an investment offering for sale to the public, often containing data about the company's operations, financial condition, and management.

SEC

The Securities and Exchange Commission, a U.S. federal agency responsible for enforcing federal securities laws and regulating the securities industry.