Bicycle helmet laws are designed to reduce the severity of ...

[Collmarie]

Bicycle helmet laws are designed to reduce the severity of injuries resulting from bicycle involvement in traffic accidents. In this sense, the helmet laws are reducing ________ of risky behavior.
 
  A) positive externalities
  B) negative externalities
  C) transactions costs
  D) the efficiency

Question 2

Refer to Table 5.2. This table shows the number of labor hours required to produce a bicycle and a harmonica in Germany and Sweden.
 
  a. Which country has an absolute advantage in the production of bicycles?
  b. Which country has an absolute advantage in the production of harmonicas?
  c. What is Germany's opportunity cost of producing one bicycle?
  d. What is Sweden's opportunity cost of producing one bicycle?
  e. What is Germany's opportunity cost of producing one harmonica?
  f. What is Sweden's opportunity cost of producing one harmonica?
  g. If each country specializes in the production of the product in which it has a comparative advantage, who should produce bicycles?
  h. If each country specializes in the production of the product in which it has a comparative advantage, who should produce harmonicas?

[chevyboi1976]

Answer to Question 1

B

Answer to Question 2

a. Sweden has an absolute advantage in the production of bicycles.
b. Sweden has an absolute advantage in the production of harmonicas.
c. Germany's opportunity cost of producing one bicycle is 4 harmonicas.
d. Sweden's opportunity cost of producing one bicycle is 4.5 harmonicas
e. Germany's opportunity cost of one harmonica is 0.25 bicycle.
f. Sweden's opportunity cost of one harmonica is 0.22 bicycle.
g. Germany should specialize in producing bicycles.
h. Sweden should specialize in producing harmonicas.