If a job requires two activities and there are two workers who can perform those activities, then which of the following statements regarding absolute advantage must be false?
a. One worker can have an absolute advantage in both activities.
b. One worker may not have an absolute advantage in neither activity.
c. Neither worker can have an absolute advantage in either activity.
d. Both workers can have an absolute advantage in both activities.
d. Both workers can have an absolute advantage in both activities.
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In the figure above, the ________ gap is equal to ________
A) recessionary; $1 trillion B) inflationary; $1 trillion C) recessionary; $12 trillion D) inflationary; $12 trillion E) recessionary; $13 trillion
As one moves down a straight-line demand curve away from the vertical axis, demand becomes less elastic and then inelastic.
Answer the following statement true (T) or false (F)
A winter ice storm has paralyzed the entire east coast, reducing productivity sharply. This supply shock shifts the marginal product of labor curve
A) up and to the right, raising the quantity of labor demanded at any given real wage. B) down and to the left, reducing the quantity of labor demanded at any given real wage. C) up and to the right, reducing the quantity of labor demanded at any given real wage. D) down and to the left, raising the quantity of labor demanded at any given real wage.
The value of total output decreases when labor leaves one industry and goes to another and capital leaves the second industry and goes to the first. This indicates that
A) the first situation was not efficient. B) the second situation is efficient. C) price is greater than marginal cost. D) it would be efficient to return to the first situation.