Suppose the United States and Japan Each Produce Only Two

question 137

Multiple Choice

Suppose the United States and Japan each produce only two goods and have the production possibilities shown in Figure 17.1.Without trade,Japan produces at point A and the United States produces at point B.Use the figure to answer the question(s) below.
-In Figure 17.1 what is the opportunity cost of a motorcycle in Japan?

• A) 1/2 of a DVD player per motorcycle.
• B) 1 DVD player per motorcycle.
• C) 2 DVD players per motorcycle.
• D) 3 DVD players per motorcycle.

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Definitions:

Bond Premium Amortization

The gradual expense recognition over time of the premium paid above the par value for a bond.

Interest Expense

The cost incurred by an entity for borrowed funds, reflected as a charge against earnings.

Interest Rate

The Interest Rate is the proportion of a loan that is charged as interest to the borrower, typically expressed as an annual percentage of the loan outstanding.

Straight-Line Amortization

A method of calculating the depreciation of an asset or the repayment of a loan in equal installments over a specified period of time.