Author Question: According to the table above determine which country has the absolute advantage in corn and which in ... (Read 65 times)

WWatsford

  • Hero Member
  • *****
  • Posts: 539
    • Biology Forums!
According to the table above determine which country has the absolute advantage in corn and which in soybeans. In addition, determine which country has the comparative advantage in corn and which in soybeans.
 
  Make sure to support your answer by deriving the opportunity costs of each.

Question 2

The supply of loanable funds has a ________ slope because the greater the interest rate, the ________ the reward to saving, and the ________ the quantity of loanable funds supplied.
 
  A) positive; lesser; lesser B) negative; lesser; greater
  C) positive; greater; lesser D) positive; greater; greater



meganlapinski

  • Sr. Member
  • ****
  • Posts: 333
Answer to Question 1

Canada has the absolute advantage in the production of corn and Mexico has the absolute advantage in the production of soybeans. In addition, Canada also has a comparative advantage in the production of corn and Mexico has a comparative advantage in the production of soybeans. The reason is that the opportunity cost of corn in Canada is  of a soybean while in Mexico the opportunity cost of corn is 5 soybeans. By taking the reciprocal of each the opportunity costs of soybean are 4 corn for Canada and 1/5 corn for Mexico.

Answer to Question 2

D



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
 

Did you know?

Chronic necrotizing aspergillosis has a slowly progressive process that, unlike invasive aspergillosis, does not spread to other organ systems or the blood vessels. It most often affects middle-aged and elderly individuals, spreading to surrounding tissue in the lungs. The disease often does not respond to conventionally successful treatments, and requires individualized therapies in order to keep it from becoming life-threatening.

Did you know?

Urine turns bright yellow if larger than normal amounts of certain substances are consumed; one of these substances is asparagus.

Did you know?

Signs of depression include feeling sad most of the time for 2 weeks or longer; loss of interest in things normally enjoyed; lack of energy; sleep and appetite disturbances; weight changes; feelings of hopelessness, helplessness, or worthlessness; an inability to make decisions; and thoughts of death and suicide.

Did you know?

Not getting enough sleep can greatly weaken the immune system. Lack of sleep makes you more likely to catch a cold, or more difficult to fight off an infection.

Did you know?

Pubic lice (crabs) are usually spread through sexual contact. You cannot catch them by using a public toilet.

For a complete list of videos, visit our video library