This Table Shows How Much Wine and Cheese Can Be

question 44

Multiple Choice

This table shows how much wine and cheese can be produced in Spain and Portugal with one unit of equivalent resources.Initially there is no trade.Once trade opens up,transportation costs are assumed to be zero.
TABLE 32-5
-Refer to Table 32-5.Once Spain and Portugal begin to trade cheese and wine,

• A)some resources will be permanently unemployed in Portugal.
• B)it will be beneficial for Portugal to ban the import of cheese.
• C)it will be beneficial for Spain to ban the import of wine.
• D)the opportunity cost of the goods they now import will be less than when there was no trade,but for Portugal only.
• E)the opportunity cost of the goods they now import will be less than when there was no trade,for both countries.

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Definitions:

Goodwill Impairment

An accounting process where the recorded value of goodwill on a company's balance sheet is reduced due to declines in the fair value of the acquired business units.

Recoverable Amount

It is the greater value between an asset's fair value less costs of disposal and its value in use.

Consolidation Worksheet

A tool used in the process of combining the financial statements of the parent company and its subsidiaries to prepare consolidated financial statements.

Intragroup Dividends

Dividends paid between companies within the same group, often eliminating in consolidation for group financial statements.