If one country has an absolute advantage in every commodity, there is no reason for it to trade
a. True
b. False
Indicate whether the statement is true or false
False
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Since the income elasticity for food is estimated to be 0.51, it appears that the proportion of income spent by poor people on food is ____ the proportion spent by those with higher incomes
a. greater than b. less than c. about the same as d. about half as great as
Based on the figure below. Starting from long-run equilibrium at point C, a decrease in government spending that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at__ creating _____gap.
A. B; no output B. D; an expansionary C. B; recessionary D. D; a recessionary
Monopoly producers face
A) many competitors producing the same product. B) only a few competitors producing the same product. C) at least one competitive producer of the same product. D) no competitive producers of the same product.
Which of the following goods should be clearly considered substitutes?
A. Peanut butter and jelly B. Right and left shoes C. Coke and Pepsi D. Gasoline and diesel fuel