One way to reduce exports is to
A) base trade on comparative advantage.
B) base trade on opportunity costs.
C) trade with poor countries.
D) restrict imports.
Answer: D
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Suppose there are only two goods: guns and roses. In Los Angeles, the absolute price of roses is 50 dollars per dozen. If the relative price of roses in terms of guns is 1 guns per dozen roses, then the absolute price of guns is
a. 5 dollars per gun. b. 2 cents per gun. c. 50 dollars per gun. d. 50 cents per gun.
Which of the following is an infant industry argument in favor of restrictions on foreign trade? a. Foreign producers must be prevented from exporting their goods below cost of production
b. Domestic workers must be protected from lower wages paid in foreign countries. c. The nation's security demands we ensure an adequate domestic supply of certain strategic goods. d. Do unto others as they do unto you. e. Industries in the early stages of development must be protected from competing with the more mature producers.
A ______ cost is ______ if the firm incurs the cost even if it produces no output.
A. fixed; sunk B. fixed; explicit C. variable; sunk D. fixed; avoidable
What does this equation represent? $2,000 for monthly rent and equipment leases / 400 units of output = $5
a. average variable cost b. average fixed cost c. diminishing marginal cost d. total average cost