Question

A country produces books and video games exclusively. In the same time it takes to produce one video game, the country could produce 4 books. If the country currently produces 800 books and 200 video games, but would like to consume a combination of 100 video games and 1400 books, which of the following is true? A. The country might consume 100 video games and 1400 books following trade. B. It is impossible for the country to consume a combination of 100 video games and 1400 books. C. This is only possible if the country produces 600 more books and 100 fewer video games itself. D. The country can produce 600 ore books and 100 fewer video games itself, or it can engage in trade..

Answer 1

The country can consume 100 video games and 1400 books by reducing its video game production by 100 and increasing book production by 400, and then engaging in trade for the remaining 200 books needed to reach its consumption goal.

Step-by-step explanation:

The country's current production stands at 800 books and 200 video games. We know that the production of one video game can be substituted for four books. If the country wants to consume 100 video games and 1400 books, it has to adjust its production or trade accordingly.

Reducing video game production by 100 units frees up the resources to produce 400 additional books (100 video games * 4 books per video game). The country would then produce 1200 books (800 + 400) and 100 video games. However, the country desires 1400 books, which means it still needs 200 more books.

Since producing these additional books internally would require cutting video game production even more, which is not an option given the consumption goal, the country would need to engage in trade to reach the desired combination of goods. The answer is A: The country might consume 100 video games and 1400 books following trade. Through trade, the country can specialize in producing the goods for which it has a comparative advantage and then trade for the additional desired goods.

Answer 2

The answer is A

I took the quick check