객관식
Assume that Joe and Carla will trade Scrambled Eggs and Fresh Squeezed Orange Juice at a rate of 1.2 Eggs for 1 OJ. If Joe's consumption after trade includes six eggs, what will be Carla's consumption after trade?
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2. Introductory Economic Models
PPF - Comparative Advantage and Trade
Multiple Choice
Which two situations are consistent with Ricardo's theory of comparative advantage?
A
Each country specializes in producing the good for which it has a lower opportunity cost and trades with the other country.
B
Both countries produce both goods in equal proportions and do not engage in trade.
C
Countries only trade if they have identical production possibilities frontiers.
D
Each country produces the good for which it has the absolute advantage, regardless of opportunity cost.
검증된 단계별 안내1
Understand Ricardo's theory of comparative advantage, which states that countries should specialize in producing goods for which they have a lower opportunity cost compared to other countries.
Identify the concept of opportunity cost: it is what you give up to produce one more unit of a good. Comparative advantage focuses on lower opportunity cost, not absolute advantage.
Analyze the options given: the correct situations must reflect specialization based on comparative advantage and mutual gains from trade.
Recognize that the statement 'Each country specializes in producing the good for which it has a lower opportunity cost and trades with the other country' aligns perfectly with Ricardo's theory.
Note that other options contradict the theory, such as producing both goods equally without trade, trading only with identical production possibilities, or specializing based on absolute advantage rather than opportunity cost.
Related Practice
