Using the above figure determine which country has the comparative advantage in the production of corn. In addition, determine which has the comparative advantage in the production of barley
What will be an ideal response?
The United States has the comparative advantage in the production of barley. The reason is that the opportunity cost to the United States for producing one bushel of barley is one bushel of corn. By contrast, Mexico's opportunity cost of one bushel of barley is two bushels of corn. Since the opportunity cost of producing one bushel of corn in Mexico is one-half of a bushel of barley that gives Mexico the comparative advantage in the production of corn.
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a. True b. False Indicate whether the statement is true or false
The Effect of State and Local Government Spending on GDP
What will be an ideal response?
In a free market, the quantity demanded will not exceed the quantity supplied of a resource, even if it is undergoing rapid depletion.
Answer the following statement true (T) or false (F)
Which of the following accurately describes the motivation behind predatory pricing?
a. to drive out competitors b. to increase sales c. to tie goods together d. to attract new customers