Suppose China can produce 200 TVs or 200 DVD players. South Korea can produce either 100 TVs or 200 DVD players. In terms of TV production, we can conclude that
A. China has an absolute advantage in TV production.
B. China has a comparative advantage in TV production.
C. South Korea has an absolute advantage in TV production.
D. South Korea has a comparative advantage in TV production.
Answer: B
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When duopoly games are repeated and a "tit for tat" strategy is used,
A) the competitive outcome is more likely to be reached than when the game is played once. B) the monopoly outcome is more likely to be reached than when the game is played once. C) both firms begin to incur economic losses. D) one firm goes out of business. E) Because the game is repeated, it is impossible to predict whether the competitive or the monopoly outcome is more likely.
The relative concept of poverty means that poverty will never be eliminated.
Answer the following statement true (T) or false (F)
Consider an antique auction where bidders have independent private values. There are two bidders, each of whom perceives that valuations are uniformly distributed between $100 and $1,000. One of the bidders is Sue, who knows her own valuation is $200. What is Sue's optimal bidding strategy in an English auction?
A. Keep bidding until the bid exceeds $200. B. Submit a bid that is less than $150. C. Submit a bid of $150. D. Submit a bid of $200.
A television station reports that the price of orange juice has declined but the quantity traded has increased. This situation could be caused by a(n):
A. Increased preference for orange juice among buyers B. Significant decrease in the harvest of oranges in the nation's orchards C. Improvement in the technology of producing orange juice D. Decrease in income, and orange juice is a normal good