Suppose That a Worker in Agland Can Produce Either 10

question 38

Multiple Choice

Suppose that a worker in Agland can produce either 10 units of organic grain or 2 units of incense per year,and a worker in Zenland can produce either 5 units of organic grain or 15 units of incense per year.There are 20 workers in Agland and 10 workers in Zenland.Currently the two countries do not trade.Agland produces and consumes 100 units of grain and 20 units of incense per year.Zenland produces and consumes 50 units of grain and no incense per year.If each country made the decision to specialize in producing the good in which it has a comparative advantage,then the combined yearly output of the two countries would increase by

• A)30 units of grain and 100 units of incense.
• B)30 units of grain and 150 units of incense.
• C)50 units of grain and 90 units of incense.
• D)50 units of grain and 130 units of incense.

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Definitions:

Trust Funds

Financial funds legally held by a trustee for the benefit of another party, known as the beneficiary.

Patent Leather

Patent Leather is a type of leather that has been finished with a high gloss, achieved through a coating process, often used in fashion items such as shoes, belts, and handbags.

Accounting Partnership

An accounting partnership is a business arrangement where two or more individuals manage and operate an accounting firm, sharing responsibilities, profits, and liabilities.

Profit-Sharing

A company program that gives employees a share in the profits of the company, often based on the company's earnings over a specific period.