« previous next »

Author Question: Critically evaluate the following statement. If a country has an absolute advantage in the ... (Read 73 times)

imowrer

  • Hero Member
  • *****
  • Posts: 514
on: Jun 29, 2018
Critically evaluate the following statement. If a country has an absolute advantage in the production of everything it necessarily follows that it will have a comparative advantage in the production of everything.
 
  What will be an ideal response?

Question 2

Refer to Figure 15-7. Suppose the economy is in a recession and no policy is pursued. Using the static AD-AS model in the figure above, this situation would be depicted as a movement from
 
  A) C to D. B) A to B. C) C to B. D) A to E. E) B to A.


carlsona147

  • Sr. Member
  • ****
  • Posts: 341
Reply #1 on: Jun 29, 2018
Answer to Question 1

This is patently false. Absolute advantage only implies that a good can be produced with fewer inputs versus a rival. Comparative advantage means that a good can be produced at lower opportunity cost than a rival. That means that a rival could have an absolute disadvantage in the production of a good or a service and still have a comparative advantage because of its lower opportunity costs.

Answer to Question 2

D


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

Signs and symptoms of a drug overdose include losing consciousness, fever or sweating, breathing problems, abnormal pulse, and changes in skin color.

Did you know?

Although the Roman numeral for the number 4 has always been taught to have been "IV," according to historians, the ancient Romans probably used "IIII" most of the time. This is partially backed up by the fact that early grandfather clocks displayed IIII for the number 4 instead of IV. Early clockmakers apparently thought that the IIII balanced out the VIII (used for the number 8) on the clock face and that it just looked better.

Did you know?

The liver is the only organ that has the ability to regenerate itself after certain types of damage. As much as 25% of the liver can be removed, and it will still regenerate back to its original shape and size. However, the liver cannot regenerate after severe damage caused by alcohol.

Did you know?

There can actually be a 25-hour time difference between certain locations in the world. The International Date Line passes between the islands of Samoa and American Samoa. It is not a straight line, but "zig-zags" around various island chains. Therefore, Samoa and nearby islands have one date, while American Samoa and nearby islands are one day behind. Daylight saving time is used in some islands, but not in others—further shifting the hours out of sync with natural time.

Did you know?

A strange skin disease referred to as Morgellons has occurred in the southern United States and in California. Symptoms include slowly healing sores, joint pain, persistent fatigue, and a sensation of things crawling through the skin. Another symptom is strange-looking, threadlike extrusions coming out of the skin.

Country of Birth of Authorized U.S. Immigrants Country of Birth of Authorized U.S. Immigrants
How to evaluate and sketch a piecewise function containing absolutes (Part 2) How to evaluate and sketch a piecewise function containing absolutes (Part 2)
How to evaluate and sketch a piecewise function pertaining to tax (Part 3) How to evaluate and sketch a piecewise function pertaining to tax (Part 3)
How to evaluate algebraic expressions with given terms How to evaluate algebraic expressions with given terms
Evaluate the following limits, if they exist - Pt 2 Evaluate the following limits, if they exist - Pt 2
Evaluate the first derivation of the following fuctions Evaluate the first derivation of the following fuctions
Video: Chemical Synapse Animation

For a complete list of videos, visit our video library