Individuals who have never been the best at doing anything
A) cannot have a comparative advantage in producing any product.
B) can still have a comparative advantage in producing some product.
C) perform all tasks at a higher opportunity cost than others.
D) must have an absolute advantage in at least ones task.
Answer: B
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A model that is an oversimplification for one purpose will likely be an oversimplification for other purposes as well.
Answer the following statement true (T) or false (F)
Sandy has graduated from college and is devoting her time to searching for a job. She has seen plenty of openings but has not yet been offered one that best suits her tastes and skills. Sandy is
a. structurally unemployed. Structural unemployment exists even in the long run. b. structurally unemployed. There is no structural unemployment in the long run. c. frictionally unemployed. Frictional unemployment exists even in the long run. d. frictionally unemployed. There is no frictional unemployment in the long run.
If a country had capital flight, then the real exchange rate would
a. fall. To offset this fall the government could increase the budget deficit. b. fall. To offset this fall the government could decrease the budget deficit. c. rise. To offset this rise the government could increase the budget deficit. d. rise. To offset this rise the government could decrease the budget deficit.
The marginal rate of technical substitution is the ratio of
A. labor to the price of labor. B. capital to the price of capital. C. capital to labor. D. the marginal product of labor to the marginal product of capital.