Question
In: Economics
suppose that companies located in Italy can produce 40,000 ton of Spaghetti Noodles for each year...
suppose that companies located in Italy can produce 40,000 ton of Spaghetti Noodles for each year of labor they employ and, also using a year of labor, can produce 4 units of machinery. Suppose companies in Japan produce, with the same amount of labor 30,000 ton of Spaghetti Noodles and 6 units of machinery.
- Which trade theory can best demonstrate the benefits of trade in this example and explain?
- Explain whether each county can specialize in production of one product or not and determine which product to specialize.
c. Illustrate the amount of total production and consumption (combined both countries) before and after specialization and production, suppose that the total production after specialization will be divided equally between the two countries for consumption
Solutions
Rahul Sunny answered 8 months agoRelated Solutions
The process that makes the spaghetti noodles for Delectable Delights is supposed to produce noodles with...
The process that makes the spaghetti noodles for Delectable
Delights is supposed to produce noodles with an average length of
252 mm. Allison, the Quality Control Manager, is
concerned that Machine #42 is not working properly and the noodles
it produces are too short. You are asked to take a
random sample of 40 noodles from Machine #42 and perform a
hypothesis test to determine if the noodles produced by the machine
are, on average, less than 252 mm. Use a significance
level...
The process that makes the spaghetti noodles for Delectable Delights is supposed to produce noodles with...
The process that makes the spaghetti noodles for Delectable
Delights is supposed to produce noodles with an average length of
252 mm. Allison, the Quality Control Manager, is concerned that
Machine #42 is not working properly and the noodles it produces are
too short. You are asked to take a random sample of 40 noodles from
Machine #42 and perform a hypothesis test to determine if the
noodles produced by the machine are, on average, less than 252 mm.
Use...
It requires 5 hours of labor to produce a ton of Steel in Italy and 3...
It requires 5 hours of labor to produce a ton of Steel in Italy
and 3 hours in China, and it requires 20 hours of labor to produce
a car in Italy and 15 hours in China.
1. Construct a production possibilities curve for each
country.
2. If Italy and China were the only countries involved in trade,
what would be the pattern of trade between them? Assume 100 hours
of labor are available in each country.
Noodles and Company tested consumer reaction to two spaghetti sauces. Each of 70 judges rated both...
Noodles and Company tested consumer reaction to two spaghetti
sauces. Each of 70 judges rated both sauces on a scale of 1 (worst)
to 10 (best) using several taste criteria. To correct for possible
bias in tasting order, half the judges tasted Sauce A first, while
the other half tasted Sauce B first. Actual results are shown below
for “overall liking.”
Sauce A: 8, 1, 9, 7, 6, 2, 5, 6, 6, 5, 8, 5, 7, 6, 5, 6, 8,...
Suppose that two countries, Italy and Palestine, produce olive oil. The currency used in Italy is...
Suppose that two countries, Italy and Palestine, produce olive
oil. The currency used in Italy is the euro (EUR), while Palestine
uses the New Israeli Shekel (NIS). In Italy, olive oil sells 6€ per
litre. The exchange rate is 5 NIS per 1 EUR.
a. If the law of one price holds, what is the price of olive oil
in Palestine, measured in NIS? (5 points)
b. Assume the average market price of olive oil in Palestine is
actually 24...
Section Exercise 4-29 Noodles and Company tested consumer reaction to two spaghetti sauces. Each of 70...
Section Exercise 4-29 Noodles and Company tested consumer
reaction to two spaghetti sauces. Each of 70 judges rated both
sauces on a scale of 1 (worst) to 10 (best) using several taste
criteria. To correct for possible bias in tasting order, half the
judges tasted Sauce A first, while the other half tasted Sauce B
first. Actual results are shown below for “overall liking.”
Sauce A: 5, 5, 3, 6, 7, 5, 7, 6, 2, 6, 5, 7, 7, 6,...
Canada and Bolivia can produce rice and soybeans. Canada requires 40 workers to produce one ton...
Canada and Bolivia can produce rice and
soybeans.
Canada requires 40 workers to produce one ton of rice
and 20 workers to produce one ton of soybeans. Canada has 1200
workers who can produce rice or soybeans.
Bolivia requires 30 workers to produce one ton of rice
and 5 workers to produce one ton of soybeans. Bolivia has 600
workers who can produce rice or soybeans.
Let ? denote tons of rice and
let ? denote tons of soybeans.
a....
The price of trade Suppose that Italy and Denmark both produce oil and olives. Italy's opportunity...
The price of trade Suppose that Italy and Denmark both produce
oil and olives. Italy's opportunity cost of producing a crate of
olives is 4 barrels of oil while Denmark's opportunity cost of
producing a crate of olives is 10 barrels of oil. By comparing the
opportunity cost of producing olives in the two countries, you can
tell that has a comparative advantage in the production of olives
and has a comparative advantage in the production of oil. Suppose
that...
The Law of One Price. Suppose that two countries, Italy and Palestine, produce olive oil. The...
The Law of One Price. Suppose that two countries, Italy and
Palestine, produce olive oil. The currency used in Italy is the
euro (EUR), while Palestine uses the New Israeli Shekel (NIS). In
Italy, olive oil sells 6€ per litre. The exchange rate is 5 NIS per
1 EUR.
a. If the law of one price holds, what is the price of olive oil
in Palestine, measured in NIS?
b. Assume the average market price of olive oil in Palestine...
A process to produce 2000 ton/ year of pyruvic acid requires a total capital investment of...
A process to produce 2000 ton/ year of pyruvic acid requires a
total capital investment of $ 30 million (working capital of $ 3
million). Fixed operating costs are $ 1 million/ year and the the
variable operating costs (excluding raw materials) is expected to
be $ 0.5/kg product. The yield of the product per ton of raw
material is 80%. The tax rate is 35%. Calculate the selling price
(in $/kg) which gives a minimum ROI after tax of...
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