Canada and the U.S. both produce wheat and computer software. Canada is said to have the comparative advantage in producing wheat if
a. Canada requires fewer resources than the U.S. to produce a bushel of wheat.
b. the opportunity cost of producing a bushel of wheat is lower for Canada than it is for the U.S.
c. the opportunity cost of producing a bushel of wheat is lower for the U.S. than it is for Canada.
d. the U.S. has an absolute advantage over Canada in producing computer software.
b
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If, for a given disposable income level, the disposable income line lies above the consumption curve, saving:
a. equals consumption. b. equals disposable income. c. is less than zero. d. is equal to zero. e. is greater than zero.
Let the marginal product of labor and capital be denoted by MPL and MPK respectively. The price of labor and capital are given by PL and PK respectively. Which of the following equations gives the condition for producing a given level of output at the least cost combination of inputs?
a. PL × PK = MPL × MPK b. PL × MPL = PK × MPK c. MPL ÷ PK = MPK ÷ PL d. PL ÷ PK = MPL ÷ MPK
The addition to total physical product when one more unit of capital (or loanable funds) is used in production is called
a. marginal physical product of capital b. marginal revenue product of capital c. marginal use of loanable funds d. interest e. depreciation
Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as 
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting upward C. Short-run aggregate supply shifting downward D. Aggregate demand shifting leftward