Smith and Jones comprise a two-person economy. Their hourly rates of production are shown in the accompanying table. Calculators Per HourComputers Per HourSmith10010Jones1206 Suppose Smith and Jones begin by producing 100 calculators per hour; as Smith and Jones choose to efficiently produce fewer computers and more calculators, ________ should devote more time to calculators because his ________.
A. Jones; opportunity costs are lower
B. Smith; absolute advantage is larger
C. Jones; absolute advantage is smaller
D. Smith; opportunity costs are lower
Answer: A
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Refer to Labor Demand and Labor Supply. What does area A + B + C represent?
The following questions refer to the accompanying diagram, which shows an industry's labor demand and labor supply. Labor and capital are the only factors used by the industry. The industry hires L units of labor at a wage of PL.
a. The industry's total revenue.
b. The rent earned by the industry's laborers.
c. The total wages paid to the industry's laborers.
d. The rent earned by the industry's capital.
Suppose that the market for corn is perfectly competitive. If corn farmers are currently generating losses, then we would expect that in the long run the market
A. supply curve will shift to the left. B. supply curve will shift to the right. C. demand curve will shift to the right. D. demand curve will shift to the left.
The more equal the income distribution in a society, the smaller the Gini coefficient
Indicate whether the statement is true or false
In the market for bicycles, explain what happens to the supply and demand curves when there is an increase in the price of steel used to make bikes
What will be an ideal response?