The ability to produce a good or service at a lower opportunity cost than other producers is
A. special advantage.
B. opportunity advantage.
C. absolute advantage.
D. comparative advantage.
Answer: D
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An invention that speeds up the Internet is an example of
A) an income effect. B) an increase in labor. C) a substitution effect. D) a supply shock.
Under perfect capital mobility, monetary policy has the largest impact on the income under:
a. floating exchange rates. b. fixed exchange rates. c. dollarization. d. a currency union.
Which of the following will increase aggregate demand in the United States?
a. A higher price level. b. An increase in the real interest rate. c. An increase in wealth due to a substantial appreciation in the value of stocks. d. A decrease in real income in Japan and Western Europe.
Which of the following people is most likely to demand U.S. dollars in the foreign exchange market?
a. A United States resident who is traveling to the Greek Islands b. An American investor who intends to buy Japanese government bonds c. A resident of Australia who is traveling to Belgium d. A British importer of U.S. beef e. A U.S. company that is importing avocados from Mexico