The Accompanying Table Shows the Output (Either Machines or Wine)that

question 262

Multiple Choice

The accompanying table shows the output (either machines or wine) that each unit of input in France and Germany can produce. We see that

• A)France has an absolute advantage over Germany in producing either output.
• B)Germany has an absolute disadvantage in producing wine.
• C)Germany has no absolute advantage over France in producing either output.
• D)France will see no economic basis for trading with Germany.

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Definitions:

Total Return

The overall earnings on an investment, including both capital gains and income, over a specific time period.

Dividends

A repeat - Financial distributions made by companies to their shareholders, typically from the firm's earnings.

Spot Exchange Rate

The current market price for exchanging one currency for another for immediate delivery.

Forward Exchange Rate

A predetermined price at which a currency transaction will occur at a future date.