Use the above table. Assuming constant opportunity costs, if countries Alpha and Beta specialize based on comparative advantage, then
A) Alpha should specialize in knives and Beta should specialize in forks.
B) Alpha should specialize in forks and Beta should specialize in knives.
C) Alpha should specialize in producing both items.
D) Beta should produce both items.
A
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When the movie Jurassic Park debuted in Westwood, California, the price of tickets was $7.50. After several months the ticket price had fallen to $4.00. This is an example of
A) peak-load pricing. B) second-degree price discrimination. C) a two-part tariff. D) tying. E) none of the above
Which of the following examples illustrates a proportional income tax?
a. I earn $5,000 and pay $500 in taxes; you earn $10,000 and pay $1,000 in taxes. b. I earn $5,000 and pay $500 in taxes; you earn $10,000 and pay $500 in taxes. c. I earn $5,000 and pay $500 in taxes; you earn $10,000 and pay $800 in taxes. d. I earn $5,000 and pay $500 in taxes; you earn $10,000 and pay $1,200 in taxes.
If the Fed's policy reaction function equals r = .02 + ?, where r is the real interest rate and ? is the inflation rate. When the inflation rate is zero, then the real interest rate will be:
A. set to equal 4 percent. B. set to equal zero. C. below the target value for the real interest rate. D. set to equal 2 percent.
In order for the government to collect taxes, the government must first establish a(n)
A. philosophy of taxation. B. justice system. C. tax base. D. ad valorem taxation.