Absolute Advantage
If Japan produces 100 apples and 200 oranges. And the US produces 400 apples and 200 oranges. This country has the absolute advantage for apples.
What is the US?
Austria can produce 3 units of steel in 1 hour and 8 brooms in 1 hour. Belgium can produce 8 units of steel in 1 hour and 1 broom in 1 hour. Who has the comparative advantage in brooms?
Belgium
True or false: opportunity cost helps country figure out what to trade.
True
Vietnam can produce 1 unit of beef in 8 hours. England can produce 1 unit of beef in 10 hours. What country has the absolute advantage?
Vietnam
Australia can make 300 sleds and 2 clarinets in 1 hour. Brazil can make 200 sleds and 1 clarinet. What country has the comparative advantage?
Brazil
True
China can produce 1 t-shirt in 1 hour and 1 flag in 2 hours. South Korea can produce 1 t-shirt in 3 hours and 1 flags in 6 hours. What country has the absolute advantage in t-shirts? What country has absolute advantage in flags?
Shirt- China
Flag- China
The definition of comparative advantage
the ability of a group to produce a good more efficiently than any other country.
True or false: trade is a factor that leads to economic growth
False