Suppose Russia exports sunflower seeds to Ireland and imports coffee from Brazil. This situation suggests
a. Russia has a comparative advantage over Brazil in producing coffee, and Ireland has a comparative advantage over Russia in producing sunflower seeds.
b. Russia has a comparative advantage over Ireland in producing sunflower seeds, and Brazil has a comparative advantage over Russia in producing coffee.
c. Russia has an absolute advantage over Ireland in producing sunflower seeds, and Brazil has an absolute advantage over Russia in producing coffee.
d. Russia has an absolute advantage over Brazil in producing coffee, and Ireland has an absolute advantage over Russia in producing sunflower seeds.
b
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If the realized real interest rate in an economy is 6%, the nominal interest rate is 8%, and the expected inflation rate is 8%, then the realized inflation rate in the economy is:
A) 2%. B) 4%. C) 8%. D) 6%.
Refer to the scenario above. if the investor plans to invest a sum of $4,000, the net present value of Option C is:
A) -$1,236.36. B) -$337.56. C) $516.80. D) $1,800.79.