Greatland and Superland both produce 5 million watches in a year. The opportunity cost of producing one watch is 2 shirts in Greatland, and the opportunity cost of producing one watch is 3 shirts in Superland
Which of the following statements is true?
A) Superland has a comparative advantage in producing watches.
B) Superland has an absolute advantage in producing watches.
C) Greatland has a comparative advantage in producing watches.
D) Greatland has an absolute advantage in producing watches.
Consider two economies, Beta and Zeta. Each farmer in Beta can grow 1,000 pounds of apples in a year or 500 pounds of oranges. Each farmer in Zeta can grow 400 pounds of apples or 1,200 pounds of oranges in a year.
C
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Suppose a market is currently served by an incumbent firm. If a potential entrant can enter prior to the incumbent firm announcing its output (or price), the entrant will enter the market and force the incumbent to compete.
Answer the following statement true (T) or false (F)
A decision or a choice that is made after using optimization analysis:
A) has zero opportunity cost. B) is not necessarily risk free. C) is the same for all individuals. D) cannot be justified using normative analysis.
Which of the following can be a barrier to an LDC's economic growth and development?
a. Low population growth. b. A low level of human capital. c. Faster capital accumulation. d. More infrastructure.
If the exchange rate, dollars per euro, is above its equilibrium level, it will heighten the possibility that France will experience a trade deficit
Indicate whether the statement is true or false