Given the Following Production Possibilities Schedules,it Can Be Seen That

question 7

Multiple Choice

Given the following production possibilities schedules,it can be seen that:

• A) Brazil has a comparative advantage in producing wine.
• B) Poland can produce more machines than Brazil.
• C) Brazil has a comparative advantage in producing machines.
• D) Poland can produce more of both goods than Brazil. Brazil has a lower opportunity cost of producing wine,1/3 vs.1,so therefore it has the comparative advantage.

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Definitions:

Effective Annual Cost

This term refers to the total cost of borrowing on an annual basis, including interest and any fees, taking compounding into account.

Nominal Cost

The original cost of an asset or investment, not adjusted for inflation or other factors affecting its current value.

Trade Credit

An arrangement to buy goods or services on account, that is, without making immediate cash payment, usually evidenced by an invoice.

Nominal Annual Cost

The stated annual cost of borrowing or investing, without adjusting for the compounding of interest or for inflation.