Table 7-6 Output Per Hour Production and Production

question 79

Multiple Choice

Table 7-6
Output per hour Production and Production
of work Consumption without Trade with Trade
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 7-6 shows the output per hour of work,the production and consumption quantities without trade,and the production numbers with trade.
-Refer to Table 7-6.All of the following are terms of trade that could possibly benefit both countries except

• A)1 belt : 1.25 swords.
• B)1 belt : 1.33 swords.
• C)1 belt : 1.75 swords.
• D)1 belt : 2.25 swords.

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Definitions:

Conversion Costs

Costs in manufacturing that include both direct labor and overhead costs, specifically associated with the conversion of raw materials into finished goods.

Direct Materials

Raw materials that are directly traceable to the production of specific goods or services.

Factory Overhead

All indirect costs associated with manufacturing, such as utilities, depreciation, and maintenance, not directly tied to production.

Conversion Costs

The sum of labor costs and overhead expenses related to the transformation of materials into finished products.