If England buys hockey sticks from Canada, then:
A. England has an absolute advantage over Canada in making hockey sticks.
B. Canada has an absolute advantage over England in making hockey sticks.
C. England has the comparative advantage over Canada in making hockey sticks.
D. Canada has the comparative advantage over England in making hockey sticks.
D. Canada has the comparative advantage over England in making hockey sticks.
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If a perpetuity has a price of $500 and an annual interest payment of $25, the interest rate is
A) 2.5 percent. B) 5 percent. C) 7.5 percent. D) 10 percent.
Suppose an ocean liner sinks and the passengers are stranded on a lush tropical island. Which of the following could most likely be used as money in the economy that develops among the survivors?
a. The life jackets they put on when leaving the ship b. The beads from the necklaces that were given out as party favors on the night the ship sank c. The coconuts growing on the island d. The fish in the sea around the island e. The sand on the island's beaches
Figure 11-3
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In Figure 11-3, if person 1 and person 2 have the indicated quantities of cheese and crackers and are on the indicated indifference curves, is there the possibility of mutually beneficial trade? Explain.
What will be an ideal response?
Which of the following functions is not performed by prices in a free market?
a. guiding the allocation of resources b. conveying information about the marginal cost of production c. making the distribution of income more equitable d. replacing the need for governmental supervision of production