Use the Following Scenario to Answer the Next Eight Questions

question 107

Multiple Choice

Use the following scenario to answer the next eight questions:
Karl and Pete produce cars and trucks. Karl can produce 10 cars per hour or 5 trucks per hour. Pete can produce 12 cars per hour or 4 trucks per hour.
-Based on the scenario,which of the following is true?

• A) Pete has an absolute advantage in producing cars but not trucks.
• B) Pete has an absolute advantage in producing trucks but not cars.
• C) Pete has an absolute advantage in producing both goods.
• D) Pete has an absolute advantage in producing neither good.
• E) Karl has a comparative advantage in producing both goods.

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Definitions:

Confidence Interval

A range of values, derived from sample statistics, that is believed to contain the true value of a population parameter with a specified level of confidence.

Population Proportion

The fraction or percentage of members in a population that exhibit a particular trait or characteristic.

Confidence Level

The percentage of times that a confidence interval, if repeated from multiple samples, would encompass the true population parameter.

Population Parameter

A numerical value that represents a characteristic of an entire population, such as mean or variance.