Suppose That the Zubians Can Produce 1000 Pounds of Flour

question 71

Multiple Choice

Suppose that the Zubians can produce 1000 pounds of flour per hours, or catch 500 pounds of fish per hour. In contrast, the Zirconians can produce 1800 pounds of flour per hour, or catch 300 pounds of fish per hours. What is the comparative advantage of the Zubians?

• A) Flour.
• B) Fish.
• C) Neither flour nor fish.
• D) Both flour and fish.

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Definitions:

Interest Expense

The sum an entity is liable for as a result of borrowing funds over a particular period.

Unearned Revenues

This reflects money received by a company for goods or services yet to be provided.

Retained Earnings

The portion of net income that is kept within the company rather than distributed to its shareholders as dividends.

Prepaid Rent

Payments made in advance for rent on a property or space that is to be used in the future, recorded as an asset on the balance sheet until the period to which the payment applies passes.