If Country A can produce an extra plane by giving up two boats, ...

[Yolanda]

If Country A can produce an extra plane by giving up two boats, and Country B can produce an extra plane by giving up three boats, then
 
  A) Country A has an absolute advantage in producing planes and a comparative advantage in producing boats.
  B) The two countries have no incentive to trade with one another.
  C) Country A would like to trade with B, but B cannot gain by trading with A.
  D) Country B has a comparative advantage over Country A in the production of planes.
  E) Country A has a comparative advantage over Country B in the production of planes.

Question 2

A balance of payments surplus occurs if
 
  A) the supply of a nation's currency is equal to the demand for the currency at the current exchange rate.
  B) exports exceed imports.
  C) the supply of a nation's currency exceeds the demand for the currency at the current exchange rate.
  D) the demand for a nation's currency exceeds the supply of the currency at the current exchange rate.

[lkanara2]

Answer to Question 1

E

Answer to Question 2

D

[Yolanda]

Thanks for the timely response, appreciate it

[dantucker]

Gracias!