Author Question: In Bangladesh one person can produce 330 pounds of rice or 110 shirts in one year. In Singapore one ... (Read 36 times)

Lobcity · **on:** Jun 30, 2018

In Bangladesh one person can produce 330 pounds of rice or 110 shirts in one year. In Singapore one person can produce 400 pounds of rice or 200 shirts in one year. Which of the following statements is true?
a. Singapore has a comparative advantage in the production of rice.
b. Singapore has both an absolute and comparative advantage in the production of rice.
c. Bangladesh has a comparative advantage in the production of rice.
d. Bangladesh has an absolute advantage in the production of rice.

Question 2

If transaction costs of negotiating are ____, the ____ suggests that the private market ____ allocate resources.
a. high; Externality Theorem; will efficiently
b. high; Coase Theorem; will not efficiently
c. low; Coase Theorem; will efficiently
d. both b. and c