Suppose It Takes Workers in Baldistan 20 Hours to Produce

question 12

Multiple Choice

Suppose it takes workers in Baldistan 20 hours to produce a metal folding table,and it takes workers in Plochia 18 hours to produce an identical table.Workers in Baldistan take 40 hours to produce a set of ceramic plates,and it takes workers in Plochia 22 hours to make identical plates.Which of the following is true?

• A) Plochia is better off making tables and plates alone and not trading with Baldistan because Plochian workers are faster at producing both types of goods.
• B) Baldistan and Plochia can gain from trading with one another.
• C) Baldistan has a comparative advantage in making plates.
• D) Plochia has a comparative advantage in making both tables and plates.

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Definitions:

Chart of Accounts

Chart of Accounts is an organized list of all accounts in a business entity’s financial statements, used for categorizing all financial transactions.

Business's Accounts

Records that summarize a company's financial transactions, including assets, liabilities, revenues, and expenses.

Expense

A cost or charge that is incurred in the process of generating revenue, typically classified on an income statement.

Liability

A financial obligation or amount owed by an individual or entity, typically representing loans or accounts payable.