In the United States, One Worker Can Produce 10 Tons

question 107

Multiple Choice

In the United States, one worker can produce 10 tons of steel per day or 20 tons of chemicals per day. In the United Kingdom, one worker can produce 5 tons of steel per day or 15 tons of chemicals per day. The United Kingdom has a comparative advantage in the production of:

• A) steel.
• B) chemicals.
• C) neither steel nor chemicals.
• D) both steel and chemicals.

---

Definitions:

Parent Corporation

A corporation that owns all of the shares of another corporation (known as its subsidiary).

Holding Company

A type of corporation that owns enough voting stock in another company to control its management and policies.

Share Exchange

A transaction in which shares of one company are exchanged for shares of another company, often used in mergers and acquisitions.

Shares Acquisition

A process in which an individual or entity purchases a portion of the shares of a company, ostensibly gaining ownership and possibly influencing control over the company.