Question

There are two companies, X and Y, that produce two identical products, A and B. If their labor productivity of the respective products is as follows, determine the following advantages:

	Product A	Product B
Company X	100 units per labor hour	30 units per labor hour
Company Y	40 units per labor hour	60 units per labor hour

Who has the absolute advantage in producing A: ______;

Who has the absolute advantage in producing B: ______;

Who has the comparative advantage in producing A: ______;

Who has the comparative advantage in producing B: ______;

• A. Y, X, Y, X.

• B. X, Y, Y, X.

• C. X, Y, X, Y.

• D. X, X, X, X.

A. Substitutes

B. The Law of Demand

C. Surplus/ over supply

D. Inferior goods.

E. Complements.

F. Normal goods.

G. Market equilibrium

H. The Law of Supply

I. Shortage

selectABCDEFGHI	1. Else the same, when price goes up, quantity demanded decreases, and when price falls, quantity demanded increases.
selectABCDEFGHI	2. Else the same, when price falls, quantity supplied decreases, and when price goes up, quantity supplied increases.
selectABCDEFGHI	3. Products that serve similar functions and from which people choose one or another.
selectABCDEFGHI	4. Products that are complementary to each other and consumed together.
selectABCDEFGHI	5. Products that people buy more when they have a higher income.
selectABCDEFGHI	6. Products that people buy less when they have a higher income.
selectABCDEFGHI	7. A situation where quantity demanded is equal to quantity supplied at a particular price and the market is clear.
selectABCDEFGHI	8. A situation where quantity demanded is higher than quantity supplied.
selectABCDEFGHI	9. A situation where quantity demanded is lower than quantity supplied.

Answer 1