Suppose That a Worker in Country a Can Make Either

question 17

Multiple Choice

Suppose that a worker in Country A can make either 10 iPods or 5 tablets each year.Country A has 100 workers.Suppose a worker in Country B can make either 2 iPods or 10 tablets each year.Country B has 200 workers.Suppose Country B's population of workers increased to 600.We can say:

• A) Country B now possesses the absolute advantage in the production of both goods.
• B) Country B now possesses the absolute advantage in tablets only.
• C) Country B now has the comparative advantage in iPod production.
• D) Country B has no need to trade now.

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Definitions:

Marginal Rate

The rate at which something changes as an immediate result of a one-unit increase, often used in economics to describe tax rates or production costs.

Transformation

The process of changing or converting something from one form or state to another, often referring to industrial, business, or technological changes.

Economic Growth

The increase in a country's production of goods and services over time, indicative of a growing economy.

Technology

Implementing scientific insights for real-world applications, chiefly in the field of industry.