Suppose That a Worker in Taiwan Can Make 2 TVs

question 141

Essay

Suppose that a worker in Taiwan can make 2 TVs or 10 pairs of shoes per week, and a worker in Korea can make 3 TVs or 20 pairs of shoes per week.
a. In what sense do TVs and shoes cost less in Korea than in Taiwan?
b. In what sense do TVs cost less in Taiwan than in Korea?
c. If Taiwan and Korea were to engage in trade, which country would export which good?
d. How would the answer to the question in part c change if a worker in Korea could make 4 TVs per week?

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Definitions:

Dopamine

Dopamine is a neurotransmitter in the brain that plays a major role in reward-motivated behavior, and it is involved in various functions such as movement, motivation, and the reinforcement of rewarding stimuli.

Cognitive Functions

Mental processes that include thinking, perceiving, remembering, reasoning, and problem-solving.

Working Memory

In many models of memory, a cognitively complex form of short-term memory; it involves active mental processes that control retrieval of information from long-term memory and interpret that information appropriately for a given task.

Dissociative Amnesia

A psychological condition characterized by memory loss that is too extensive to be explained by ordinary forgetfulness, often related to trauma or stress.