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Table 7-6 Production and

question 70

Multiple Choice

Table 7-6
Production and
Consumption Production
Without Trade With Trade
Table 7-6 Production and Consumption Production Without Trade With Trade Estonia and Morocco can produce both swords and belts.Table 7-6 shows the production and consumption quantities without trade,and the production numbers with trade. -Refer to Table 7-6.If the actual terms of trade are 1 belt for 1.5 swords and 70 belts are traded,how many belts will Estonia consume? A) 50 B) 70 C) 90 D) 120 Estonia and Morocco can produce both swords and belts.Table 7-6 shows the production and consumption quantities without trade,and the production numbers with trade.
-Refer to Table 7-6.If the actual terms of trade are 1 belt for 1.5 swords and 70 belts are traded,how many belts will Estonia consume?

Definitions:

Consumption Function

A representation in economics indicating the relationship between total consumer expenditures and household income levels.

Interest Rate

The cost of borrowing money or the return on savings, expressed as a percentage, influencing economic activity by affecting spending and investment decisions.

Consumption Function

An economic formula representing the relationship between total consumption and gross national income, indicating how changes in income affect spending.

Saving

The portion of income not spent on current expenditures or consumption, often put aside for future use or investment.