Table 2-7 Table 2-7 Shows the Output Per Month of Two People

question 184

Multiple Choice

Table 2-7

Table 2-7 shows the output per month of two people, Fred and Barney. They can either devote their time to making pogo sticks or making unicycles.
-Refer to Table 2-7.Which of the following statements is true?

• A)Fred has an absolute advantage in making both products.
• B)Barney has an absolute advantage in making both products.
• C)Barney has an absolute advantage in making pogo sticks and Fred in making unicycles.
• D)Barney has an absolute advantage in making unicycles and Fred in making pogo sticks.

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Definitions:

Required Rate of Return

A rephrased definition; the minimum percentage of return investors demand from an investment to compensate for its risk.

Constant Rate

A constant rate implies a steady, unchanging rate of growth or return over a specified period of time.

Year-End Dividend

A dividend payment made by a company to its shareholders at the end of its fiscal year.

Recreational Vehicles

Motor vehicles or trailers equipped with living space and amenities found in a home, used for travel or camping.