It takes Ross 6 hours to produce a bushel of corn and 2 hours to wash and polish a car. It takes Courtney 6 hours to produce a bushel of corn and 1 hour to wash and polish a car. Courtney and Ross cannot gain from specialization and trade, since it takes each of them 6 hours to produce 1 bushel of corn
a. True
b. False
Indicate whether the statement is true or false
False
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In the United States during the 1930s
A) government spending decreased and taxes increased, resulting in a fiscal contraction. B) government spending and taxes both decreased, resulting in a net fiscal contraction. C) government spending increased and taxes decreased, resulting in a fiscal expansion. D) government spending and taxes both increased, resulting in zero net fiscal expansion.
Fiscal policy would be more effective if:
A. the government could change taxes and expenditures rapidly. B. potential income was unknown. C. the size of the government debt didn't matter. D. crowding out occurred more often.
Monopolies are inefficient because
A) they price discriminate. B) they maximize profits. C) they always make above-normal profits. D) they charge a price above marginal cost.
In a partnership, the owners of the business and the business are ________, and in a sole proprietorship, the owner of the business and the business are ________
A) separate legal entities; also separate legal entities B) not separate legal entities; also not separate legal entities C) not separate legal entities; separate legal entities D) separate legal entities; not separate legal entities