Refer to Table 9-3. Select the statement that accurately interprets the data in the table
A) Tina has a comparative advantage in making candles.
B) Bryce has a comparative advantage in making candles and making soap.
C) Bryce has a comparative advantage in making candles.
D) Bryce has an absolute advantage in making soap.
A
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Using Figure 10.1 above is it possible to determine the price that this product is selling for if it is being sold in a competitive market? If so what is that price?
What will be an ideal response?
For each of the following situations, choose a fiscal policy and explain how it could be used to correct the economic problem
a. Real GDP is below potential GDP following a financial market crisis. b. A positive demand shock increases aggregate expenditure beyond the full employment level and leads to fears of rising inflation. c. The economy is in a recession due to rising defaults on mortgages following the bursting of a housing bubble.
The cost of using capital is equal to the market rental price as long as:
A. a firm rents all of the capital used in its production process. B. a firm owns all of the capital used in its production process. C. the cost of capital is expensed in the year the capital is purchased. D. a well-functioning rental market for capital exists.
The long-run aggregate supply curve shows:
A. the economy's actual growth rate whether things are going well or not. B. the economy's potential inflation rate if all is going well. C. the economy's potential growth rate if all is going well. D. the economy's actual inflation rate whether things are going well or not.