Newland - 10 cloth, 2 food
Beeland - 10 cloth, 1 food
The table above shows the production possibilities of two nations that are producing cloth and food, using equal amounts of resources.
A1 - Calculate the opportunity cost of producing a unit of cloth in Newland.
A2 - Calculate the opportunity cost of producing a unit of food in Beeland.
B1 - Which nation has the comparative advantage in cloth production?
B2 - Which nation has the comparative advantage in food production?
C - Now assume that the productivity of Beeland's workers triples for each good.
C1 - Which country has a comparative advantage in food production?
C2 - Explain how you determined your answer.
*Taken from the College Board released free response questions
A1-1/5 food
ReplyDeleteA2-10 cloth
B1-Beeland
B2-Newland
C1-Newland
C2-both of the products increased so the ratios remained the same
I don't know if i did this right but it was worth a try....
Kathryn Carr
A1- 1:5 Food
ReplyDeleteA2- 1:10(?) Cloth
B1- Beeland
B2- Newland
C1- Newland
C2- Ratio is still the same
I hope I did it right. I forgot my notebook so I had to try from memory.
A1. 1/5 food
ReplyDeleteA2. 10 cloth
B1.Beeland
B2.Newland
C1.Newland
C2. Since each product is increased by 3x times. Cloth is now produced at 30 and food at only 3. However the ratio still remains the same at 10 parts cloth : 1 part food. Which means NL still has the smaller ratio 5:1 and continues to hold the CA for food.
A1. 1:5
ReplyDeleteA2. 10
B1. Beeland
B2. Newland
C1. Newland
C2. Since both of Beeland's productions triple they factor out with the same ratios as question B2, leaving Newland with the compartive advantage for food.
A1) 1/5 food
ReplyDeleteA2) 10 cloth
B1) Beeland
B2) Newland
C1) Newland
C2) Since the productivity tripled for both products, the ratios for comparative advantage remained the same. Even if they could now produce more food, they would be losing an equivalent increase in the amount of cloth they could have produced, so it evens out.
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ReplyDeleteA1) 1/5 Food
ReplyDeleteA2) 10 Cloth
A3) Beeland
A4) Newland
C1) Newland
C2) Since both goods tripled, the ratio remains the same.
A1.1/5 food
ReplyDeleteA2.10 cloth
B1.Beeland
B2.Newland
C1.Newland
C2.The ratio stays the same even when both goods are multiplied by 3.
A1. 1/5 food
ReplyDeleteA2. 10 cloth
B1. Beeland
B2. Newland
C1. Newland
C2. Ratio remains the same because both goods tripled.
A1. 1/5 food
ReplyDeleteA2. 10 cloth
B1. Beeland
B2. Newland
C1. Newland
C2. The ratio remains the same because both goods are tripled.
A1. 1/5 food
ReplyDeleteA2. 10 cloth
B1. Beeland
B2. Newland
C1. Newland
C2. The ratio does not change.
A1)- 1/5 food
ReplyDeleteA2)- 10 cloth
B1)- Beeland
B2)- Newland
C1)- Newland
C2)- both of the products were multiplied by 3, therefore the ratios stayed the same.
A1) 1/5 food
ReplyDeleteA2) 10 cloth
B1) Beeland
B2) Newland
C1) Newland
C2) Even though it's tripled, both products are multiplied by 3 so the ratio remains the same.
A1. 1:5 Food
ReplyDeleteA2. 1:10 Cloth
B1. Beeland
B2. Newland
C1. Newland
C2. The ratio remains the same since both goods are tripled.
A1) 1:5 Food
ReplyDeleteA2) 1:10 Cloth
B1) Beeland
B2) Newland
C1) Newland
C2) Ratio remains the same because its just multiplied by a factor of 3
A1) 1:5 food
ReplyDeleteA2) 1:10 cloth
B1) Beeland
B2) Newland
C1) Newland
C2) Ration remains the same because it is multiplied by 3
Dustin Stone
A1: 1/5 food
ReplyDeleteA2: 10 cloth
B1: Beeland
B2: Newland
C1: Newland
C2: The ratio does not change.