Suppose an American Worker Can Make 20 Pairs of Shoes

question 94

Multiple Choice

Suppose an American worker can make 20 pairs of shoes or grow 100 apples per day.On the other hand,a Canadian worker can produce 10 pairs of shoes or grow 20 apples per day.The opportunity cost of one pair of shoes for the United States is _______,while the opportunity cost of one pair of shoes for Canada is _________.

• A) 5 apples; 2 apples
• B) ¹/₅ apple; ½ apple
• C) 2,000 apples; 200 apples
• D) 100 apples; 20 apples

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Definitions:

RRSP

Registered Retirement Savings Plan, a Canadian account for holding savings and investment assets, with tax benefits.

Canadian Equity

Investments in stocks or shares of Canadian companies, representing ownership and a claim on part of the company's assets and earnings.

Annually Compounded

An interest rate compound method where the calculation of interest is done once per year.

Loan Term

The duration of time over which a loan agreement is in effect, and by the end of which the loan should be repaid.