For Each Surfboard That Australia Produces, It Gives Up the Opportunity

question 36

Multiple Choice

For each surfboard that Australia produces, it gives up the opportunity to make 25 boomerangs.New Zealand can produce 1 surfboard for every 15 boomerangs it produces.Which of the following is true about the comparative advantage between the two countries?

• A)Australia has the comparative advantage in producing surfboards.
• B)Australia has the comparative advantage in producing boomerangs.
• C)New Zealand has the comparative advantage in producing surfboards and boomerangs.
• D)New Zealand has the comparative advantage in producing boomerangs.

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Definitions:

Job Cost Sheet

A document that records the costs related to a specific job or project, tracking materials, labor, and overhead.

Manufacturing Overhead

All indirect costs associated with the production process, including utilities, rent for manufacturing facilities, and salaries of supervisory staff.

Unit Costs

The cost incurred by a company to produce, store, and sell one unit of a particular product or service.

Raw Materials Inventory

The stock of unprocessed materials that are used in manufacturing to produce goods, representing a current asset on the balance sheet.