Answer the Question Using the Accompanying Cost Ratios for Two

question 154

Multiple Choice

Answer the question using the accompanying cost ratios for two products, fish (F) and chicken (C) , in countries Singsong and Harmony. Assume that production occurs under conditions of constant costs and that these are the only two nations in the world.Singsong: 1F = 2CHarmony: 1F = 4CIf these two nations specialize based on comparative advantage,

• A)Singsong will both produce chicken and catch fish.
• B)Harmony will both produce chicken and catch fish.
• C)Harmony will produce chicken and Singsong will catch fish.
• D)Singsong will produce chicken and Harmony will catch fish.

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Definitions:

Indirect Costs

Expenses that are not directly attributable to a specific product or activity but are necessary for the business's operation, such as utilities or administrative salaries.

Financial Distress

A scenario in which a corporation is unable to fulfill or struggles with settling its debts to those it owes money.

Earnings Per Share

A financial ratio indicating the amount of profit attributed to each outstanding share of a company's common stock, calculated as net income divided by the number of shares.

Debt To Equity Ratio

An indicator of financial leverage obtained by dividing a business's total debts by the equity owned by its stockholders.