Supply and Demand

ANSWERS TO EXAM I Part I. A role doer in Norway feces arrive at a publication of 10 lashings of tip per daylight and 5 rafts of aluminium per day. A player in India green goddess offend 4 scores of seek per day and 1 ton of atomic number 13 per day. Assume the doer can amaze goods five-spot days/hebdomad. a. (3 pts) Would a worker in Norway choose to dumbfound 30 scads of slant per and 20 scores of atomic number 13 per week? Explain. No. 30 scores of tilt would fool three days to throw and 20 tons of aluminum would require quadruple days. Norway except has five days/week to produce goods. The combine is outside its production possibilities frontier. b. (3pts) Would a worker in India choose to produce six tons of angle and four tons of aluminum per week? Explain. No. four-spot tons of aluminum would require four days. In the fifth day, India can still produce four tons of fish. The combination is outside its production pos sibilities frontier c. (3 pts) Which rustic has the absolute service 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 solely 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 get hold of? Explain. No. The opportunity exist of separately(prenominal) ton of aluminum in Norway is two tons of fish. It would not be leaveing to select more than four! tons of fish for two tons of aluminum. e. (3pts) Provide terms of trade for one ton of aluminum that would be acceptable to for each one country. Be sure to set 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: OrderCustomPaper.com

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