Which of the Following Statements Is True for the Two

question 78

Multiple Choice

Which of the following statements is true for the two countries illustrated in Figure 35.1?

• A)Japan has an absolute advantage in motorcycles.
• B)The United States has a comparative advantage in DVD players.
• C)Japan has an absolute advantage in motorcycles, the United States in DVD players.
• D)The United States has a comparative advantage in motorcycles, Japan in DVD players.

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Definitions:

Incentive Programs

Schemes designed to motivate and reward desired behaviors or performance from individuals or groups.

State of Nature

A term used in decision theory referring to the actual but possibly unknown status of the world, which affects the outcomes of decisions.

Opportunity Loss

The cost of the next best alternative foregone as a result of making a decision.

Actual Profit

The realised gain from business operations or investments, after all costs and expenses have been deducted.