Table 2-9 Table 2-9 Shows the Output Per Week of Week

question 181

Multiple Choice

Table 2-9
Table 2-9 shows the output per week of two jewelers, Serena and Haley. They can either devote their time to making bracelets or making necklaces.
-Refer to Table 2-9. Which of the following statements is true?

• A) Haley has an absolute advantage in making both products.
• B) Serena has an absolute advantage in making both products.
• C) Haley has an absolute advantage in making bracelets and Serena in making necklaces.
• D) Haley has an absolute advantage in making necklaces and Serena in making bracelets.

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Definitions:

Fair Values

The estimated market value of an asset or liability, based on current conditions and knowledgeable, willing parties' transactions.

Book Values

The value of an asset as reported on the balance sheet, calculated as the original cost of the asset minus any depreciation, amortization, or impairment costs.

Gain or Loss

The financial result of disposing of an asset or settling a liability for more or less than its carrying amount.

Equity Method

An accounting technique used when a company holds significant influence over another but does not control it, allowing the investment to be recorded at original cost and adjusted for the investor's share of profits and losses.