Refer to the Information Provided in Table 20 $\quad$ $\quad$

question 234

Multiple Choice

Refer to the information provided in Table 20.1 below to answer the question(s) that follow.
Table 20.1 $\quad$$\quad$$\quad$$\quad$$\quad$ $\text {Mexico}$$\quad$ $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\text {Guatemala}$
$\begin{array}{rrrr} \text {Oranges}& \text {Bananas}& \text {Oranges}& \text {Bananas}\\ \text { bushel/acre}&\text { bushel/acre }&\text { bushel/acre}&\text { bushel/acre }\\\hline 200 & 0 & 50 & 0 \\160 & 40 & 40 & 20 \\120 & 80 & 30 & 40 \\80 & 120 & 20 & 60 \\40 & 160 & 10 & 80 \\0 & 200 & 0 & 100 \\\hline\end{array}$

-Refer to Table 20.1. Guatemala should specialize in and export ________, and Mexico should specialize in and export ________.

• A) oranges; oranges
• B) bananas; bananas
• C) bananas; oranges
• D) oranges; bananas

Recognize the concept of substitute and complementary goods and how changes in prices affect demand for these goods.

Understand the role and impact of private enterprise and government intervention in the economy.

Understand the concept of Weighted Average Cost of Capital (WACC) and its importance in financial management.

Describe the factors influencing the cost of capital for different sources including debt, equity, and preferred stock.

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Definitions:

Products And Services

Tangible goods that are manufactured and sold to consumers, and intangible activities provided to satisfy consumer needs or wants, respectively.

Scarcity

A fundamental economic problem of having seemingly unlimited human wants in a world of limited resources.

Positive Statements

Factual statements that can be tested and validated, describing the world as it is rather than how it should be, typically used in economic analysis.

Value Judgments

Assessments or opinions made based on a set of criteria or moral standards rather than factual evidence alone.