If Shawn Can Produce Donuts at a Lower Opportunity Cost

question 136

Multiple Choice

If Shawn can produce donuts at a lower opportunity cost than Sue, then

• A) Shawn has a comparative advantage in the production of donuts.
• B) Sue has a comparative advantage in the production of donuts.
• C) Shawn should not produce donuts.
• D) Shawn is capable of producing more donuts than Sue in a given amount of time.

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Definitions:

Pharmaceutical Company

A commercial business licensed to research, develop, market, and/or distribute drugs, most commonly in the context of healthcare.

Ethnocentric Staffing Model

A staffing approach used by multinational companies that primarily uses parent country nationals to staff higher-level foreign positions.

International Business

The carrying out of trade and investment activities by firms across national borders, encompassing the management of international operations.

Host-Country Nationals

Individuals who are citizens of the country in which a foreign subsidiary is located and are employed by the subsidiary.