The Following Table Indicates the Production Possibilities of Food and Clothing

question 73

Multiple Choice

The following table indicates the production possibilities of food and clothing per worker day in the United States and Japan.
Which of the following is true?

• A) Mutual gains from trade could be realized if the United States specialized in food production and Japan in clothing production.
• B) Since Japanese workers produce more of both food and clothing than U.S. workers, no gains from trade are possible.
• C) Joint output would be maximized if the United States specialized in producing clothing and Japan in producing food.
• D) The Japanese are the low-cost producers of both food and clothing.

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Definitions:

Ending Inventory

The total value of unsold goods held by a company at the end of an accounting period.

Inventory System

Methods and procedures used to track materials, work-in-progress, and finished goods from acquisition through sale.

Weighted-Average

A calculation method where different data points are given different weights, often used in inventory valuation and cost accounting.

Ending Inventory

The final amount of goods available for sale at the end of an accounting period.