Don can produce 10 pens or 20 pencils in one hour while Bob can produce 5 pencils or 15 pens in one hour. Which of the following statements is correct?
a. Don has an absolute advantage over Bob in the production of pencils and Bob in the production of pens
b. Bob has an absolute advantage over Don in the production of pencils
c. Bob has a comparative advantage over Don in the production of pens
d. Don has a comparative advantage over Bob in the production of pens
e. Don does not have a comparative advantage in the production of either good
C
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Refer to Figure 19-12. The graph above, depicts supply and demand for U.S. dollars during a trading day. At a fixed exchange rate of 0.30 pounds per dollar, the dollar is ________ versus the pound
A ________ of the dollar would correct the fundamental disequilibrium that exists in this market. A) overvalued; revaluation B) overvalued; devaluation C) undervalued; devaluation D) undervalued; revaluation
The central bank which is generally regarded as the most independent in the world because its charter cannot be changed by legislation is the
A) Bank of England. B) Bank of Canada. C) European Central Bank. D) Bank of Japan.
A good that is used as a medium of exchange as well as being a consumption good is called
A) a barter money. B) a commodity money. C) a legal tender. D) a debased money.
If the monopolist’s supply curve is drawn, it is a positively sloped curve similar to that for the perfectly competitive market.
Answer the following statement true (T) or false (F)