An individual or country that has a comparative advantage in the production of one good:
A. must have an absolute advantage in the good's production.
B. must not have an absolute advantage in the good's production.
C. may or may not have an absolute advantage in the good's production.
D. must not have an absolute advantage in the production of the other good.
Answer: C
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The longer a patent lasts,
A) the greater the potential economic profits available to an innovator. B) the lower the deadweight loss. C) the lower the average costs of production. D) the less innovation there will be.
A demand curve that has constant price elasticity of demand coefficient equals to one at all points is a(n):
a. rectangular hyperbola. b. downward-sloping straight line. c. upward-sloping straight line. d. none of these.
When a country has the ability to produce more of a good than others with a given amount of resources, they:
A. have an absolute advantage. B. have a comparative advantage. C. are free-traders. D. should remain self-sufficient.
When real rates of interest are positive, it is better to be a:
A. saver than a borrower, because the value of savings and debts are increasing. B. borrower than a saver, because the value of savings and debts are increasing. C. saver than a borrower, because the value of savings and debts are decreasing. D. borrower than a saver, because the value of savings and debts are decreasing.