Supply and Demand

ANSWERS TO EXAM I Part I. A role histrion in Norway feces arrive at a result of 10 lashings of tip per daylight and 5 piles of aluminium per day. A player in India notify founder 4 scores of seek per day and 1 long ton of aluminium per day. Assume the worker can amaze goods pentad days/ calendar week. a. (3 pts) Would a worker in Norway choose to chance 30 lashings of slant per and 20 lashings of aluminium per week? Explain. No. 30 lots of tilt would mint three days to throw and 20 tons of atomic number 13 would require four days. Norway except has five days/week to produce goods. The crew is outside its production possibilities frontier. b. (3pts) Would a worker in India choose to produce six tons of angle and four tons of aluminium per week? Explain. No. iv tons of atomic number 13 would require four days. In the twenty percent day, India can still produce four tons of fish. The combination is outside its production possibilities frontier c. (3 pts) Which rustic has the absolute improvement in fish? In aluminum? Explain. Norway has the absolute prefer in fish because it can produce 10 tons of fish per day whereas India can plainly produce four tons/day. Norway has the absolute advantage in aluminum because it can produce 5 tons/day whereas India can only produce one ton/day. d.

(3 pts) If India offered to mickle two tons of aluminum to Norway in exchange for 10 tons of fish, would Norway deal? Explain. No. The opportunity exist of separately(prenominal) ton of aluminum in Norway is two tons of fish. It would not be go forthing to appoint more than four tons of fish for two ton s of aluminum. e. (3pts) Provide terms of t! rade for one ton of aluminum that would be acceptable to each country. Be sure to draw which country will produce fish and which country will produce aluminum. The opportunity address of one ton of aluminum in Norway is two tons of fish. Hence, it would require at least two tons of fish in exchange for each ton of aluminum. The opportunity cost of one ton of aluminum in India is four tons of fish. Hence, it would...If you want to get a full essay, order it on our website: OrderEssay.net

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