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.

Understand the principle of the percentage of sales approach in financial forecasting.

Comprehend how changes in dividend payout ratios affect a firm's growth and financing needs.

Understand the concept of plowback ratio and its significance for a firm's future growth.

Calculate a firm's sustainable and internal growth rates using accounting statements.

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Definitions:

Responsibility Center

A segment of a business, such as a department or division, whose manager is accountable for specific financial activities and performance.

Budgetary Unit

An entity, such as a department or division, for which a budget is prepared and controlled.

Managerial Department

A department within an organization responsible for making management decisions, overseeing operations, and developing strategies.

Cash Budget

is a financial plan that estimates cash inflows and outflows over a specific period of time, often used for managing liquidity and ensuring financial stability.