Figure 7-8 shows the optimal input combinations for the production of a given quantity of cotton in the United Arab Emirates and in Egypt
-Refer to Figure 7 -8. Which of the following could explain why the United Arab Emirates and Egypt use different input combinations to produce a given quantity of cotton, and yet each country produces that quantity at the lowest possible cost?
A) because the prices of inputs are not the same for the two countries: labor is relatively lower priced and capital is relatively higher priced in the United Arab Emirates
B) because the prices of inputs are not the same for the two countries: labor is relatively lower priced and capital is relatively higher priced in Egypt
C) because the United Arab Emirates has more sophisticated technology and therefore is more efficient in cotton production
D) because the marginal product per dollar spent on capital yields a higher return in the United Arab Emirates than in Egypt

Question

Figure 7-8 shows the optimal input combinations for the production of a given quantity of cotton in the United Arab Emirates and in Egypt
-Refer to Figure 7 -8. Which of the following could explain why the United Arab Emirates and Egypt use different input combinations to produce a given quantity of cotton, and yet each country produces that quantity at the lowest possible cost?
A) because the prices of inputs are not the same for the two countries: labor is relatively lower priced and capital is relatively higher priced in the United Arab Emirates 
B) because the prices of inputs are not the same for the two countries: labor is relatively lower priced and capital is relatively higher priced in Egypt 
C) because the United Arab Emirates has more sophisticated technology and therefore is more efficient in cotton production 
D) because the marginal product per dollar spent on capital yields a higher return in the United Arab Emirates than in Egypt

Quizplus · Accepted Answer

The Answer of  Figure 7-8 shows the optimal input combinations for the production of a given quantity of cotton in the United Arab Emirates and in Egypt
-Refer to Figure 7 -8. Which of the following could explain why the United Arab Emirates and Egypt use different input combinations to produce a given quantity of cotton, and yet each country produces that quantity at the lowest possible cost?
A) because the prices of inputs are not the same for the two countries: labor is relatively lower priced and capital is relatively higher priced in the United Arab Emirates 
B) because the prices of inputs are not the same for the two countries: labor is relatively lower priced and capital is relatively higher priced in Egypt 
C) because the United Arab Emirates has more sophisticated technology and therefore is more efficient in cotton production 
D) because the marginal product per dollar spent on capital yields a higher return in the United Arab Emirates than in Egypt

Figure 7-8 Shows the Optimal Input Combinations for the Production