Suppose That a Worker in Country a Can Make Either

question 24

Multiple Choice

Suppose that a worker in Country A can make either 25 bananas or 5 tomatoes each year.Suppose that a worker in Country B can make either 18 bananas or 6 tomatoes each year.Country B has an absolute advantage in:

• A) the production of bananas, but not tomatoes.
• B) the production of both bananas and tomatoes.
• C) the production of tomatoes, but not bananas.
• D) neither good.

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Definitions:

Affect Heuristic

A mental shortcut used in decision making that involves relying on current emotions to evaluate the desirability and risks of different options.

Real Buying Power

The actual amount of goods and services that can be purchased with a unit of currency, taking into account inflation and other factors affecting price levels.

Short-Term Losses

Financial losses realized on the sale or exchange of assets held for a short period, typically less than one year.

Supply Chain Risk

The potential for financial, operational, and reputational losses arising from vulnerabilities and disruptions in a company's supply chain.