Table 19-12
Output Per Hour Production and Production
of Work

question 343

Multiple Choice

Table 19-12
Output per hour Production and Production
of work Consumption without Trade with Trade
$\begin{array}{|c|c|c|c|c|c|c|}\hline & \text { Swords } & \text { Belts } & \text { Swords } & \text { Belts } & \text { Swords } & \text { Belts } \\\hline \text { Estonia } & 5 & 3 & 100 & 40 & 200 & 0 \\\hline \text { Morocco } & 2 & 2 & 60 & 60 & 0 & 120 \\\hline\end{array}$ Estonia and Morocco can produce both swords and belts. Each country has a total of 40 available labor hours for the production of swords and belts. Table 19-12 shows the output per hour of work, the production and consumption quantities without trade, and the production numbers with trade.
-Refer to Table 19-12.Which country has a comparative advantage in producing belts?

• A) Estonia
• B) Morocco
• C) both countries
• D) neither country

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Definitions:

Unit Fixed Costs

The consistent expenses incurred by a company for each unit produced that do not change with the volume of production.

Level of Activity

A measure of the volume of production or operations, often influencing costs and profitability in a business.

Variable Costs

Expenses that vary in relation to the amount of products or services a company generates.

Fixed Costs

Expenses that do not change with the level of goods or services produced by a business over a certain period.