International Trade

Question 1

Which option best explains why countries trade with each other?

Revolt · Accepted Answer

to obtain goods they cannot produce efficiently

Question 2

Why do countries specialize? Check all that apply.

Revolt · Accepted Answer

to produce more of certain goods and services in a more efficient way; to trade with one another for goods or services they cannot provide on their own; to produce more goods and services, and to contribute to greater global prosperity

Question 3

Comparative advantage means the ability to produce a good or service

Revolt · Accepted Answer

with a lower opportunity cost than another country.

Question 4

Which phrase best defines the term “opportunity cost”?

Revolt · Accepted Answer

what a country gives up when it chooses to produce a good or service

Question 5

Jamal and Keisha are considering entering into an agreement to trade tasks.How can specialization of labor benefit Jamal and Keisha? Check all that apply.

Revolt · Accepted Answer

Keisha can specialize in washing cars, because she has the comparative advantage.; Specialization allows them to collectively mow 3 more lawns and wash 3 more cars every three days.; Specialization allows them to earn more money.

Question 6

Question 7

Revolt · Accepted Answer

Country A

Question 7

Fill in each blank with the correct number from the table.Based on the data in the table, the opportunity cost for Country A to produce 16 units of petroleum is ⇒ 8, eight units of seafood.The opportunity cost for Country B to produce 8 units of petroleum is ⇒ 8, eight units of seafood.

Revolt · Accepted Answer

⇒ 8, eight: 8, eight

Question 8

The opportunity costs are shown in parentheses in the table. According to opportunity costs, should specialize in petroleum. According to opportunity costs, should specialize in seafood.

Revolt · Accepted Answer

Country A; Selection 1: Country A; Selection 2: Country B

Question 9

How can the law of comparative advantage be applied to Country A and Country B?

Revolt · Accepted Answer

Country A should produce petroleum, and Country B should produce seafood.

Question 10

Without specializing, the total output for both countries after two days would be 48.If Country A were to specialize in petroleum, its output would be ⇒ 32, thirty-two, thirtytwo, thirty two after two days.If Country B were to specialize in seafood, its output would be ⇒ 16, sixteen after two days.

Revolt · Accepted Answer

⇒ 32, thirty-two, thirtytwo, thirty two: 32, thirty-two, thirtytwo, thirty two; ⇒ 16, sixteen: 16, sixteen

International Trade Answers

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