Suppose the relative prices of goods X and Y are PX/PY =3 in Country A and PX/PY

Fantastic news! We've Found the answer you've been seeking!

Question:

Suppose the relative prices of goods X and Y are PX/PY =3 in Country A and PX/PY = 7 in Country B under autarky. Which statement is correct? ( )

a. Country A has definitely an absolute advantage in both goods.

b. Only Country B would profit from opening up to free trade.

c. Country B has a comparative advantage in good Y.

d. None of the above statements is correct.

Related Book For answer-question

Microeconomics

ISBN: 978-1118572276

5th edition

Authors: David Besanko, Ronald Braeutigam

See More Books

Posted Date: Dec 21, 2022 11:12 PM

See More Questions

Suppose that each consumer consumes goods X and Y with preferences represented by the utility function: U(X, Y) = X + 2Y. Each consumer has income of $150. The supply curve for good X is horizontal...
Suppose you believe that two variables X and Y are related, but you have no idea which way the causality goes. Does X cause Y or vice versa (or maybe even neither)? Can you tell by regressing Y on X...
Suppose that X and Y are random variables such that (X, Y) must belong to the rectangle in the xy-plane containing all points (x, y) for which 0 x 3 and 0 y 4. Suppose also that the joint c.d.f....
On your first day as a intern at Tri-Star Management Incorporated the CEO asks you to analyze the following information pertaining to two common stock investments, Tech.com Incorporated and Sam's...
You are a consultant who has been hired to improve the effectiveness of corporate trainers. These trainers frequently make presentations to employees on topics such as conflict management, teamwork,...
The Department of Natural Resources in Wisconsin monitors air quality in the state. Ozone is a major component of smog and high temperatures also contribute. The summer maximum daily ozone (ppm) and...
Enter the following in the personal accounts only. Do not write up the other accounts. Balance down each personal account at the end of the month. After completing this, state which of the balances...
One of the examples in this chapter dealt with determining the optimal reorder point for a computer monitor sold by Millennium Computer Corp. Suppose that it costs MCC $0.30 per day in holding costs...
Daffy Duct, Inc., began operations on January 1. During the year, it made 50,000 rolls of duct tape and sold 40,000 of them. Daffy Duct incurred the following costs: Raw materials $8,000 Wages of...
Answer the following questions related to the Docks Creek Land Company case presented in the chapter: 1. How does Robertsons role differ from Wisemans? 2. Are the professional standards applied...
Zara Chin is the Head of Wealth Management for a large APAC private bank based in Singapore. Zara has access to a large and diversified team of investment specialists including economist, investment...
Find dy dx dy for the function y = x 7 cos(x) dx -
Let four point charges be located at the vertices of a rectangle as shown in the figure. We give Q = 3 nC, Q1= -2Q, Q2 = -4Q, Q3 = 4Q and Q4= 3Q, as well as dA = 3 cm and dB = 4 cm. What is the...
da If a + y = 26, and = 4 when x=5 and y = 1, what is dt dy dt when x = 5 and y = 1? dt
Assume the total monthly operating costs of a McDonald's restaurant are: $40,000+$0.75X Where X = Number of salad order Required Determine the average cost per salad at each of the following monthly...
The yields of $1000 dollar par value zero-coupon government bonds (ignore liquidity premiums) are tabled below: Years to Maturity Yield to 1 Maturity 4.00% 2 5.30% 3 6.1% 4 6.5% 5 7.85%
Describe two or three social networking apps that could use a smartphone's GPS capability. Be sure to make clear the benefit of using the GPS in the app in each case.
Dan and Diana file a joint return. Dan earned $31,000 during the year before losing his job. Diana received Social Security benefits of $5,000. a. Determine the taxable portion of the Social Security...
Give three examples of negative externalities and three examples of positive externalities, other than examples that appear in the text.
A firm has the monthly production function where L is worker hours per month and K is square feet of manufacturing space. a. If the hourly wage rate is $50 and manufacturing space costs $25 per...
Jason has a boat-building firm. It uses labor L, capital K, and materials M, to build its boats. Its production function is For what values of Î±, Î², and Î³ does...
(a) Prove the equivalence (5.25), including the inequalities, for real numbers $A, B, C$ that fulfill \(A
Complete the proof of Proposition 5.2 for the third case \(x_{1}
Find positive weights $w$ in a utility function of the form $u\left(c_{1}, c_{2} ight)=$ $c_{1}+w \cdot c_{2}$ to create at least four different strict rankings among the candidates $x, y, z$...

Suppose the relative prices of goods X and Y are PX/PY =3 in Country A and PX/PY

Question:

Expert Answer:

The detailed answer f... View the full answer

Microeconomics

Students also viewed these economics questions