Table 7-6 Output Per Hour Production and Production

question 136

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.If the actual terms of trade are 1 belt for 1.5 swords and 50 belts are traded,how many belts will Estonia consume?

• A)50
• B)70
• C)90
• D)120

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Definitions:

Planned Investment

Expenditures on capital goods by firms, intended to increase their future production capacity.

Marginal Propensity

The fraction of an additional amount of income that is spent on consumption.

Aggregate Expenditure

The total amount spent on national-level goods and services in an economy.

Disposable Income

Income available to households after accounting for taxes and social security charges, available for spending or saving.