Table 3-8 Assume That Huang and Min Can Switch Between Producing Parasols

question 374

Multiple Choice

Table 3-8
Assume that Huang and Min can switch between producing parasols and producing porcelain plates at a constant rate.

-Refer to Table 3-8.Huang has an absolute advantage in the production of

• A) parasols and a comparative advantage in the production of parasols.
• B) parasols and a comparative advantage in the production of plates.
• C) neither good and a comparative advantage in the production of parasols.
• D) neither good and a comparative advantage in the production of plates.

---

Definitions:

Out-of-Pocket Costs

Out-of-pocket costs are expenses that individuals directly pay from their funds, not covered by third-party payers like insurance.

Incremental Revenue

Additional revenue generated from a specific action or decision, beyond what would have been generated otherwise.

Special Order

A one-time order that is not considered part of the company's normal ongoing operations.

Incremental Costs

These are the additional costs incurred when increasing the production volume or taking on a new project.