Suppose that a worker in Country A can make either 25 bananas or 5 tomatoes each year. Country A has 200 workers. Suppose a worker in Country B can make either 18 bananas or 6 tomatoes each year. Country B has 400 workers. The opportunity cost of one tomato is:
A. lower in Country A than Country B.
B. the same in both countries.
C. higher in Country A than Country B.
D. impossible to calculate without more information.
Answer: C
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Although a corporation that is owned by its member banks, the Federal Reserve System
A. reports directly to the president in an annual report. B. is quite independent of them, and they receive almost none of the Fed’s profits. C. is administered by Congress and all its profits are distributed to the member banks. D. turns all its profits over to the state governments of each district bank.
Owners of a parking lot are deciding whether or not to add more parking spaces to the lot. The owners should increase parking spaces as long as:
a. LRMR=LRMC
b. LRMR>LRMC
c. LRMR
A decrease in the economy’s capacity utilization rate
a. tends to decrease the unemployment rate. b. tends to increase the unemployment rate. c. has no impact on the unemployment rate. d. tends to have an unpredictable effect on the unemployment rate.
The value of money in the United States is based on the stocks of precious metals held by the U.S. government.
Answer the following statement true (T) or false (F)