Assume That Greece Has a Comparative Advantage in Fish and Germany

question 50

Multiple Choice

Assume that Greece has a comparative advantage in fish and Germany has a comparative advantage in cars.Also assume that Germany has an absolute advantage in both fish and cars.If these two countries specialize and trade so as to maximize the benefits of specialization and trade,then

• A)the two countries' combined output of both goods will be higher than it would be in the absence of trade.
• B)Greece will produce more fish than it would produce in the absence of trade.
• C)Germany will produce more cars than it would produce in the absence of trade.
• D)All of the above are correct.

Explain the concept of opportunity cost in the context of budget constraints and consumer choice.

Understand the relationship between budget constraints and the consumer's choice set.

Apply mathematical equations to represent budget constraints and solve for optimal consumer choices.

Recognize the effect of market dynamics such as price changes or income fluctuations on household budget constraints and choices.

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Definitions:

Trust

The reliance on the integrity, strength, ability, or character of a person or thing, forming the foundation for meaningful relationships and societal functions.

Negotiation

A dialogue between two or more parties aimed at reaching a consensus or resolving a conflict, often involving compromise or agreement on various terms.

Collectivistic Orientation

A cultural attribute that prioritizes group goals over individual ones and emphasizes interdependence among group members.

Individualistic Orientation

A social pattern or attitude valuing personal independence and individual achievements over collective goals or affiliations.