The Production Possibilities Table Given Below Shows How Many Bushels

question 32

Multiple Choice

The production possibilities table given below shows how many bushels of either wheat or rice can be produced in India and Canada with 1 unit of input.To achieve gains from specialization:

• A) India should export rice to Canada and import Canadian wheat.
• B) India should export wheat to Canada and import Canadian rice.
• C) Canada should produce both wheat and rice and not trade with India.
• D) India should produce both wheat and rice and not trade with Canada.

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Definitions:

Variable Costs

Expenses that vary directly with the level of production or sales volume, such as raw materials and direct labor costs.

Breakeven Volume

The quantity of goods or services that must be sold to cover fixed and variable costs, resulting in no profit or loss.

Units

A measure of quantity or amount used in the context of production, inventory, or sales within various sectors.

Contribution Margin

The amount by which sales revenue exceeds variable costs of production, contributing to the coverage of fixed costs and profit generation.