Assume that U.S. producers can manufacture cookies at a lower opportunity cost than Mexican producers. If this is the case
A) it will not be possible for Mexico to have an comparative advantage in the production of any other products.
B) Mexico could still have the comparative advantage in cookie production.
C) it would still be possible for Mexico to have a comparative advantage in trade for some other products.
D) Mexico would have the comparative advantage in all products compared to the United States.
Answer: C
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Refer to the above figure. A shortage occurs if the government imposes
A) a price floor at $60. B) a price floor at $20. C) a price ceiling at $60. D) a price ceiling at $20.
If the price elasticity of demand for a good is 2, then a 10 percent decrease in the quantity demanded must be the result of
a. a 0.2 percent increase in the price. b. a 2.5 percent increase in the price. c. a 5 percent increase in the price. d. a 20 percent increase in the price.
Much of a person's increased productivity can be linked to
A) on-the-job training. B) the prevalent marginal tax rate. C) the price elasticity of demand for the product. D) the income elasticity of demand for the product.
In a given year, a country's GDP = $3843, net factor payments from abroad = $191, taxes = $893, transfers received from the government = $422, interest payments on the government's debt = $366, consumption = $3661, and government purchases = $338. Calculate the values of private saving, government saving, and national saving.
What will be an ideal response?