ECON 3HH3 Study Guide - Quiz Guide: Hogwarts, Autarky, Opportunity Cost

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amaranthsnake273

19 Apr 2019

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This problem is based on the ricardian model. Assume that there are 10 trolls in gryffindor and 20 trolls in slytherin. Since the opportunity cost of magic wands (the slope of the ppf above that is equal to mplw/mplf = 10/6. Answer: the trade price ratio always is between the price ratios of two countries in autarky. Answer: trade patterns in the ricardian model depend on the comparative advantage. That is why gryffindor will export magic wands and slytherin will export chocolate frogs. (d) for each country, calculate the real wage in terms of magic wands and in terms of chocolate frogs. Answer: gryffindor will produce only magic wands, so its wage in terms of magic wands is its. To calculate its wage in terms of brooms, we need to know how many chocolate frogs. Wage in terms of frogs = w/pf = (pw*mplw)/pf=(pw/pf)*mplw =1. 8*6 = 10. 8.

Related Questions

1.True or False: In the Ricardian model, you always produce only the good you have a comparative advantage in producing.

2. True or False: In the Ricardian model, knowing who has a comparative advantage in each good is enough to know the quantity of exports and imports to/from each country.

3. True or false: In the two country two good Ricardian model, it is impossible to have a comparative advantage the production of both goods.

turquoisecricket410

SCENARIO: ABSOLUTE AND COMPARATIVE ADVANTAGE
Poland requires 4 hours of labor to produce a ton of coal and 10hours of labor to produce 10 bushels of wheat. The Czech Republic requires 6 hours of labor to produce a ton of coal and 10 hours of labor to produce 10 bushels of wheat.

26. (Scenario: Absolute and Comparative Advantage) Which country has an absolute advantage in the production of wheat?
A) Poland
B) the Czech Republic
C) neither country
D) both countries

27. (Scenario: Absolute and Comparative Advantage) Which country has an absolute advantage in the production of coal?
A) Poland
B) the Czech Republic
C) neither country
D) both countries

28. (Scenario: Absolute and Comparative Advantage) Which country has a comparative advantage in the production of coal?
A) Poland
B) the Czech Republic
C) neither country
D) both countries

29. (Scenario: Absolute and Comparative Advantage) Which countryhas a comparative advantage in the production of wheat?
A) Poland
B) the Czech Republic
C) neither country
D) both countries

30. (Scenario: Absolute and Comparative Advantage) What is theopportunity cost of coal in Poland?
A) 1/4 hour of labor/ton of coal

B) 2 1/2 bushels of wheat/ton of coal

C) 4 hours of labor/ton of coal
D) 4/10 bushels of wheat/ton of coal

Scenario: Absolute and Comparative Advantage) In Poland, what is the marginal product of labor in coal production?
A) 2.5 tons per hour
B) 0.4 tons per hour
C) 4 tons per hour
D) 0.4 tons per bushel of wheat

raspberrybeaver558

Consider a Ricardian model with two goods, cheese C and wine W. The unit labor input requirements are: a_LC = 3, a_LW = 2, a_LC * = 2 , a_LW * = 1 (an asterisk denotes a foreign variable). The supply of labour in each country is 10. Assume throughout that the price of good W in each country is equal to 1.

1. Which country has comparative and which absolute advantage in which goods?

azurewallaby706

ECON 3HH3 Study Guide - Quiz Guide: Hogwarts, Autarky, Opportunity Cost

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