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Suppose Paraguay can produce 12 wheat or 3 corn. Suppose Bolivia can produce 4 wheat or 2 corn. Suppose opportunity costs are constant. Given these production possibilities,
 
  A) Paraguay has a comparative advantage in wheat.
  B) Paraguay has a comparative advantage in corn.
  C) Paraguay has a comparative advantage in both goods.
  D) Paraguay has an absolute advantage in neither good.

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Question 2 - The domestic currency is said to be ________ if it has appreciated at a lower rate than the difference between the domestic inflation rate and the higher foreign inflation rate.
 
  A) undervalued
  B) overvalued
  C) appreciated
  D) risky

[ 1 ]  A

[ 2 ]  A

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