Consider the United States' production of soy beans and running shoes. If the United States has an absolute advantage in the production of both goods compared to China,
A) only the United States can gain from trade.
B) each country will be able to produce at a point beyond its PPF.
C) only China can gain from trade.
D) only the United States will be able to operate beyond its PPF.
E) both countries can gain from trade.
E
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If the government offers to pay wheat farmers $1 for every bushel of wheat they market next year, in addition to the market price, the price of wheat will be
A) higher than it would otherwise have been. B) lower than it would otherwise have been. C) one dollar. D) the same as it would otherwise have been although wheat farmers will be better off.
A business cycle is the:
a. period of time in which expansion and contraction of economic activity are equal. b. period of time in which there are three phases: peak, depression, and recovery. c. recurring growth and decline in real GDP. d. period of time in which a business is established and ceases operations.
Refer to the above figure. Demand will be elastic when quantity is between
A. 0 and A. B. 0 and B. C. A and B. D. B and C.
Inflation makes certain things less valuable in real terms, including:
A. anything expressed in dollars. B. your full college scholarship. C. a fixed monthly pension payment. D. real estate and precious metals.