There are 10 workers in Thailand and each can produce either 4 computers or 60 tons of rice. There are 20 workers in the United
States and each can produce either 10 computers or 80 tons of rice. Draw the production possibilities curve for each country.
1 answer:
Answer:
The answer is in the image attached
Explanation:
We will ultiply the output per worker by the amount of workers to get the output for each country
<u>United States:</u>
20 workers x 10 output each = 200 computers
20 workers x 80 output each = 1,600 tons of rice
<u>Thailand:</u>
10 x 4 = 40 computer
10 x 60 = 600 tons of rice
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Answer: b. For a bond of any maturity, a 1.0 percentage point increase in the market interest rate (rd) causes a larger dollar capital loss than the capital gain stemming from a 1.0 percentage point decrease in the interest rate
Explanation:
This is very true. If market rates reduce by 1.0%, there is a larger drop in the price of a bond than the amount a bond gains in price if interest rates increase by that same 1.0%.
This is why the graph that relates bond prices to yield is concave and I attached a graph as proof.
Notice how the fall in price is greater when interest rate increases.
