Comparative advantage has mixed results when it comes to predicting a country's trade patterns. Which of the following is FALSE?
A) There are many potential products an economy might export that use the same comparative advantage.
B) A large share of international trade is not based on comparative advantage.
C) Comparative advantage has proven completely incapable of predicting trade.
D) Comparative advantage is a dynamic concept, which means that the spread of technology, improvement in skills, and learning-by-doing may alter a country's comparative advantage over time.
C
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Suppose you must pay a non-refundable $200 down payment to order a new item. Pick the true statement below
A) The $200 represents a marginal cost before you commit to the down payment. B) The $200 represents a sunk cost after you've committed to the down payment. C) Both A and B are true. D) Neither A nor B are true.
A good salesperson can sell $1,000,000 worth of goods, while a poor one can sell only $100,000 worth of goods. Job applicants know if they are good or bad, but the firm does not
A firm will offer job applicants a choice between a fixed salary of $25,000 or 20% commission. Assuming risk-neutral salespersons and the possibility of opportunistic behavior, will this choice of contracts allow the firm to distinguish between good salespersons and bad ones before the hiring decision is made?
Cruise liners offer last minute deals because
a. The marginal cost is higher than the marginal revenue since fixed costs are sunk b. The marginal costs of an additional passenger are very low at that point and companies gain by lowering prices c. The average cost of an additional passenger is very low at that point and companies gain by lowering prices d. All of the above
An example of a Pigovian tax would be a tax on:
A. cigarettes. B. alcohol. C. gasoline. D. All of these are examples.