Final answer:
The Dulac Box plant's production increased by 20% when they shifted from two 10-hour shifts to three 8-hour shifts. The scenario with the U.S. and Mexico illustrates the benefits of focusing on comparative advantages, where both countries increase their overall production by specializing in goods they are relatively better at producing.
Step-by-step explanation:
When the Dulac Box plant changed its production schedule from two 10-hour shifts producing 500 boxes to three 8-hour shifts producing 600 boxes, they were focused on responding to higher demand by increasing their total daily production. The correct response to what has happened to production is option c. It has increased by 20%. Initially, 500 boxes per day were produced, and after the schedule change, the production increased to 600 boxes per day. This represents a 20% increase in production (100 boxes increase / 500 boxes original = 0.20).
As for the scenario involving the United States and Mexico, when these countries transfer labor towards their area of comparative advantage, overall production efficiency and output increases. In this example, the U.S. increases its production of refrigerators, which they are relatively more efficient at, and Mexico increases its production of shoes, their comparative advantage. This strategic transfer of labor and resources is key to maximizing economic efficiency and production output.