21)For any country, if the world price of computers is higher than the
domestic price of computers, that country should:
a)export computers, since that country has a comparative advantage in
computers
b)import computers, since that country has a comparative advantage in
computers
c)not trade computers, since that country cannot gain from trade
d)not trade, since they already produce computers cheaper than other
countries

22)For two people who are planning to trade two different goods, each
will have a comparative advantage in a different good unless:
a)one person has an absolute advantage in both parties
b)they have agreed in advance on who will produce what and how much
each will produce
c)the terms of trade are such that neither can gain from trade
d)they have exactly the same opportunity cost

23)Suppose that a worker in Cornland can grow either 40 bushels of
corn or 10 bushels of oats per year, and a worker in Oatland can grow
either 20 bushels of corn or 5 bushels of oats per year.  There are 20
workers in Cornland and 20 workers in Oatland.  Which of the following
statements is true?
a)both countries could gain from trade with each other
b)neither country would gain from trade because Cornland has an
absolute advantage in both goods
c)neither country would gain from trade because neither one has a
comparatice advantage
d)only Oatland could possibly gain from trade

24)Suppose that the  country of Xenophobia chose to isolate itself
from the rest of the world.  Its ruler proclaimed that Xenophobia
should become self-sufficient, and so would not engage in foreign
trade.  From an economic perspective, this idea would:
a)make sense if Xenophobia had an absolute advantage in all goods
b)makes sense if Xenophobia had no absolute advantage in any goods
c)not make sense as long as Xenophobia had a comparative advantage in
any good
d)not make sense as long as Xenophobia had an absolute advantage in at
least half the goods traded


25)The opportunity cost of an item is:
a)the number of hours needed to earn money to buy it
b)what you give up to get that item
c)always less than the dollar value of an item
d)always equal to the dollar value of the item

Hi again k9queen!!

21)For any country, if the world price of computers is higher than the
domestic price of computers, that country should:
a)export computers, since that country has a comparative advantage in
computers

-------------------------------------------------

22)For two people who are planning to trade two different goods, each
will have a comparative advantage in a different good unless:
d)they have exactly the same opportunity cost.

--------------------------------------------------

23)Suppose that a worker in Cornland can grow either 40 bushels of
corn or 10 bushels of oats per year, and a worker in Oatland can grow
either 20 bushels of corn or 5 bushels of oats per year.  There are 20
workers in Cornland and 20 workers in Oatland.  Which of the following
statements is true?
Both countries has the same opportunity costs for both products, so
the correct answer is:
c)neither country would gain from trade because neither one has a
comparatice advantage.

The opportunity cost of goods must differ among countries to let the
countries to gain from trade. In such situation countries gain because
trade gives them the chance to buy products at a lower relative price
(opportunity cost) than is possible with domestic production only and
to sell its exports at a higher relative price (opportunity cost) than
is possible with domestic sales only. This is not the case in this
question.

-------------------------------------------------------

24)Suppose that the  country of Xenophobia chose to isolate itself
from the rest of the world.  Its ruler proclaimed that Xenophobia
should become self-sufficient, and so would not engage in foreign
trade.  From an economic perspective, this idea would:
c)not make sense as long as Xenophobia had a comparative advantage in
any good.

-------------------------------------------------------

25)The opportunity cost of an item is:
b)what you give up to get that item.

-------------------------------------------------------

I hope this helps you. Feel free for ask for further clarifications if
they are needed.

Best regards.
livioflores-ga