If the US Can Produce Pizza for $5 Each and Barrels of Barrels

question 47

Multiple Choice

If the U.S. can produce pizza for $5 each and barrels of beer for $25 each, and Germany can produce pizza for $7 each and barrels of beer for $21 each, then Germany has

• A)a comparative advantage in the production of beer.
• B)an absolute advantage in the production of beer.
• C)a comparative advantage in the production of pizza.
• D)a comparative advantage in the production of beer and pizza.

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Definitions:

Trade Agreements

Formal agreements between countries that determine the rules of trade between them, including tariffs, import quotas, and product standards.

Trade Disputes

Conflicts that arise between countries or businesses over aspects of trade, including tariffs, trade barriers, or disagreements on trade agreements.

AACSB

The Association to Advance Collegiate Schools of Business is an accreditation body for business schools worldwide, ensuring that member institutions meet rigorous standards of quality and improvement in business education.

Responsible Management

An approach to management that seeks to make business decisions considering ethical values, social responsibility, and environmental sustainability.