Is it possible for a firm to have an absolute advantage in producing something without having a comparative advantage? Why or why not?
What will be an ideal response?
Yes, a firm can have an absolute advantage without having a comparative advantage. A firm may be able to produce more of a good or service than its competitors, but that does not necessarily mean it can produce the good or service at a lower opportunity cost than its competitors.
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Refer to the above payoff matrix (in years of sentence) for two people (Bo and Max) charged for robbery. Which of the following is the outcome of the dominant strategy without cooperation?
A) Both Bo and Max confess. B) Both Bo and Max do not confess. C) Bo confesses while Max does not confess. D) Bo does not confess while Max confesses.
A monopolist can sell 7 units per day at $7 per unit, or 8 units per day at $6 per unit. Its marginal revenue for the eighth unit of output is: a. $48. b. $6
c. $1. d. -$1.
All of the following are objectives of the Federal Reserve system, except
A. to furnish an elastic currency. B. to conduct monetary policy. C. to accept deposits from individuals. D. to serve as a lender of last resort to commercial banks and thrift institutions.
Briefly explain one function of financial instruments that can make them very different from money.
What will be an ideal response?