Table 2-9 Table 2-9 Shows the Number of Labor Hours

question 11

Multiple Choice

Table 2-9
Table 2-9 shows the number of labor hours required to produce a wristwatch and a pound of rice in Japan and Thailand.
-Refer to Table 2-9.Does either Japan or Thailand have an absolute advantage and if so,in what product?

• A)Thailand has an absolute advantage in rice.
• B)Japan has an absolute advantage in rice.
• C)Thailand has an absolute advantage in both products.
• D)Japan has an absolute advantage in wristwatches.

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Definitions:

Dividend Payout Ratio

A financial ratio that shows the percentage of earnings a company pays to its shareholders in the form of dividends, providing insight into the proportion of earnings distributed versus retained.

Capital Structure

The mix of a company's long-term debt, specific short-term debt, common equity, and preferred equity that it uses to finance its overall operations and growth.

Residual Dividend Theory

A policy whereby a company pays dividends to shareholders from leftover earnings after all operational costs and capital investment projects are covered.

Operating Income (EBIT)

Refers to an entity's earnings before interest and taxes, calculated by subtracting operating expenses from gross income, indicating the profitability from regular operations.