In which of the following cases should the United States produce more noodles than it wants for its own use and trade some of those noodles to Italy in exchange for wine?
a. Americans know less than Italians know about cooking noodles.
b. The United States has an absolute advantage over Italy in producing noodles.
c. Italy has a comparative advantage over the United States in producing wine.
d. The opportunity cost of producing a gallon of wine is the same for Italy as it is for the United States.
c
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Laura's Pizza Place incurs $800,000 per year in explicit costs and $100,000 in implicit costs. The restaurant earns $1.3 million in revenues. Based on this information, what is the accounting profit for Laura's Pizza Place?
A) $200,000 B) $400,000 C) $500,000 D) $900,000
Faced with the evidence of poor working conditions and low wages in the border maquiladoras, economists
A) shrug their shoulders and ignore the issue. B) agree that trade theory is thus proven hollow and internally inconsistent. C) argue that U.S. consumers should not consume lettuce. D) argue that the poor conditions and low wages are actually improvements for the Mexican workers, and may be cited as gains-from-trade. E) argue that Mexico's generally high overall productivity offsets these conditions.
Price discrimination refers to
a. the actions of a single-price monopolist to determine the best price for its output b. selling the same product to different customers at different prices as a result of different production costs c. government regulation of public utility prices d. selling the same product to different customers at different prices for reasons unrelated to production costs e. charging a price just above average total cost in order to drive competing firms from the market
If nominal GDP is 8,100 billion florins and the money supply is 900 billion florins, the velocity of circulation is
A. 900.0. B. 90.0. C. 81.0. D. 9.0. E. 8.1.