Hello, can you please show which statement is true, and how to get that Suppose countries A and B produce and consume (assuming convex preferences) apples and bananas using only labour Unit labour cost for apples in country A are 1 and 2 in country B Unit labour cost for bananas are 2 in country A and 5 in country B The labour force is the same in both countries, and given by 100 in each country Which three of the following statements are true A Allowing for international trade, the production of 50 apples and 50 bananas is feasible, but not under autarky B Under autarky, the relative price for apples (price for apples price for banans) equals 0 5 in country A and 0 4 in country B C Country B has a comparative advantage in producing bananas D Allowing for international trade, the production of 50 apples and 50 bananas can occur in a global market equilibrium feasible, but not in market equilibria under autarky E Country A will produce bananas, with or without international trade F Each country has an absolute advantage

The Answer is in the image, click to view ...

Question: Hello, can you please show which statement is true, and how to get that. Suppose countries A and B produce and consume (assuming convex preferences)

Hello, can you please show which statement is true, and how to get that.

Suppose countries A and B produce and consume (assuming convex preferences) apples and bananas using only labour. Unit labour cost for apples in country A are 1 and 2 in country B. Unit labour cost for bananas are 2 in country A and 5 in country B. The labour force is the same in both countries, and given by 100 in each country. Which three of the following statements are true?

A: Allowing for international trade, the production of 50 apples and 50 bananas is feasible, but not under autarky.
B: Under autarky, the relative price for apples (price for apples/price for banans) equals 0.5 in country A and 0.4 in country B.
C: Country B has a comparative advantage in producing bananas.
D: Allowing for international trade, the production of 50 apples and 50 bananas can occur in a global market equilibrium feasible, but not in market equilibria under autarky.
E: Country A will produce bananas, with or without international trade.
F: Each country has an absolute advantage.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Economics Questions!

Answer these.. 3} Diana has a car whose value is $40K. The probability of an accident is 10% and she will lose the car at occurrence of the accident. Diana has wealth of $20K aside from the car, and...

Micro quiz!!! 24. Unigene Labs has existing assets that generate an EPS of $5 per year, which is expected to remain constant if the firm does not invest except to maintain exiting assets. Unigene is...

Pliz Help. 5. Consider a simple economy in which only two goods are produced and sold: pizza and beer: The prices and quantities produced of these two goods over a th ree-year period are shown in the...

For the project, Students should read Chapter 19 and then write a short Chapter Summary, T he world is a giant shopping mall, and Americans are big spenders. For example, the U.S. population is less...

Read the case scenario and use the text provided to support your answer and only used the text provided Case Scenario Dion is an engineer with Tesla Motors who helps to design electric motors. It has...

TACKLE ALL PARTSP5 Problem 1 The Airfare Problem1. You are trying to get the cheapest airfare that you can. You just called up and found that the ticket home will cost $400, and it cannot be refunded...

Solve the following Short Answer (40 points - 10 points each)_Answer each of the following short answer questions in the space provided. Be concise, but do not simply use bullet-points to answer the...

Learning Objectives 3-1 By the end of this section, you will be able to: Explain demand, quantity demanded, and the law of demand Identify a demand curve and a supply curve Explain supply, quantity...

eco9 Read Case 5-1: Netflix on pages 181-182. Complete one of the following for your original post. Responses to peers can include additional examples from personal experience, additional support for...

Illinois Soy Products (ISP) buys soybeans and processes them into other soy products. Each ton of soybeans that ISP purchases for $ 340 can be converted for an additional $ 190 into 575 pounds of soy...

The billing department of a major credit card company attempts to control errors (clerical, data transmission, etc.) on customers bills. Suppose that errors occur according to a Poisson distribution...

16 The cards show two different sequences. You can see that the first four terms in sequence A are smaller than the first four terms in sequence B. What is the term number of the first term in...

What is meant by the evolution of the chef with regard to supervisory positions?

12. Think of a situation where you felt particularly powerless. It must be a real event that you remember relatively well. Try to think back. What was it you imagined just before you felt powerless...

13. Try to imagine how you would feel if you had tackled the problem, the con-flict, the challenge, etc., that made you powerless in task 12, for example upstairs, confident, confident, calm,...

15. Ask yourself the following questions: What do you want to remember from your everyday experiences? These are the experiences that fill most of your life. They may take 9099% of your time. What do...