Question
Country A can produce 10 units of cloth or 20 units of
wheat per day. Country B can produce 15 units of cloth or 15 units of wheat per day. Which of the following statements is true?Solution
To determine comparative advantage, we need to compare the opportunity costs. For Country A: Opportunity cost of 1 unit of cloth = 2 units of wheat (since 10 cloth = 20 wheat). Opportunity cost of 1 unit of wheat = 0.5 units of cloth. For Country B: Opportunity cost of 1 unit of cloth = 1 unit of wheat. Opportunity cost of 1 unit of wheat = 1 unit of cloth. Since the opportunity cost of producing wheat is lower in Country A (0.5 units of cloth) compared to Country B (1 unit of cloth), Country A has a comparative advantage in producing wheat.
What is the main objective of the PENCIL Portal?
How long is the maternity leave for those adopting a child below the age of three months or surrogate mothers?
Which Author has been selected for Saraswati Samman 2022?
A sum of money paid regularly (typically annually) by a company to its shareholders out of its profits is called as?
Which of the following best defines Tax buoyancy?
...
In an economy, head count ratio is the measure of:
...
For the first time in India, medical benefit as a non-cash benefit was provided under?
Conrad Kongkal Sangma, the 12th and current Chief Minister of Meghalaya belongs to which political party?
Under the provisions of the Industrial Disputes Act 1947, the employer of any industry declares lay-off, is required to provide alternate employment to ...
Which of the following is responsible for the implementation of “ Atal Bimit Vyakti Kalyan Yojana (Abvky)”?
