The United States has an absolute advantage in
productivity with regard to both shoes and refrigerators
; that is, it takes fewer workers in the United States than in Mexico to produce both a given number of shoes and a given number of refrigerators.
Does the US have a comparative advantage in oil?
| Country Oil Production (barrels) Corn Production (bushels) | United States (C’) 20 60 |
|---|
Which country has an absolute advantage in?
In Table 1,
Saudi Arabia
has an absolute advantage in the production of oil because it only takes an hour to produce a barrel of oil compared to two hours in the United States. The United States has an absolute advantage in the production of corn.
What is absolute advantage example?
A clear example of a nation with an absolute advantage is
Saudi Arabia
, The ease with which oil is extracted which greatly reduces the cost of extraction is its absolute advantage over other nations.
What comparative advantage does the US have with Mexico?
So, the comparative advantage of the United States, where its absolute productivity advantage is relatively greatest, lies with refrigerators, and Mexico’s comparative advantage,
where its absolute productivity disadvantage is least, is in the production of shoes
.
Does Canada have an absolute advantage?
The Canadian economy has an
absolute advantage in agricultural goods
relative to most other countries globally. This because land is relatively abundant in Canada, as well as low cost.
What is Italy absolute advantage?
Absolute advantage looks
at the efficiency of producing a single product
. … As an example, if Japan and Italy can both produce automobiles, but Italy can produce sports cars of a higher quality and at a faster rate with greater profit, then Italy is said to have an absolute advantage in that particular industry.
Which country has an absolute advantage in producing oil?
In Table 1,
Saudi Arabia
has an absolute advantage in the production of oil because it only takes an hour to produce a barrel of oil compared to two hours in the United States.
What does the US import the most?
| Rank US Import Product 2020 Value (US$) | 1 Cars $145,659,382,000 | 2 Computers, optical readers $104,948,207,000 | 3 Phone system devices including smartphones $102,547,452,000 | 4 Medication mixes in dosage $95,175,568,000 |
|---|
What does China have a comparative advantage in?
The model predicts that China has a comparative advantage in
heavy goods in nearby markets
, and lighter goods in more distant markets. This theory motivates a simple empirical prediction: within a product, China’s export unit values should be increasing in distance.
How do you know if you have absolute advantage?
To calculate absolute advantage,
look at the larger of the numbers for each product
. One worker in Canada can produce more lumber (40 tons versus 30 tons), so Canada has the absolute advantage in lumber. One worker in Venezuela can produce 60 barrels of oil compared to a worker in Canada who can produce only 20.
What is the difference between comparative advantage and absolute?
Absolute advantage refers to the ability to produce more or better goods and services than somebody else. Comparative advantage refers to the ability to produce goods and services at a
lower opportunity cost
, not necessarily at a greater volume or quality.
Is it possible to have a comparative advantage without having an absolute advantage?
A comparative advantage exists when a country can produce goods at a lower opportunity cost compared to other countries.
It is not possible for a country
to have a comparative advantage in all goods. … An absolute advantage exists when a country is simply the best (most efficient) in producing a product or service.
Does the US have a trade deficit or surplus with Mexico?
The U.S. goods and services trade deficit with Mexico was
$98.5 billion in 2019
. Mexico is currently our largest goods trading partner with $614.5 billion in total (two way) goods trade during 2019. Goods exports totaled $256.6 billion; goods imports totaled $358.0 billion.
What is Mexico’s competitive advantage?
Competitive Advantages of Mexico Manufacturing. The advantages of manufacturing in Mexico are many:
lower labor costs, open trade agreements, and access to a skilled workforce
.
What does Mexico produce the most of?
Mexico is among the world’s largest producers of
oil, silver, copper, gold, lead, zinc, natural gas and wood
. Other minerals, such as mercury, cadmium, antimony, manganese, iron and coal are also found.
