Suppose Japan has a comparative advantage over Canada in the production of DVDs. This means that Japan:
A. needs fewer resources to produce DVDS than does Canada.
B. has better technology for producing DVDs than does Canada.
C. has a lower opportunity cost of DVD production than does Canada.
D. can produce more DVDs in a given period of time than can Canada.
Answer: C
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The Herfindahl-Hirschman Index is calculated by ________
A) adding the market share of each firm in the market and squaring the resulting number B) squaring the market share of each firm competing in the market and then summing the resulting numbers C) adding the number of firms in the market and squaring the resulting number D) adding the profit earned by each firm in the market
Government mandated safety standard within firms
A) will always decrease efficiency. B) can increase efficiency by avoiding a prisoner's dilemma outcome. C) are unnecessary because of asymmetric information. D) will create unfair competition among firms.
Intermediation in the financial system is the process of:
A. an arbitrator working with government and private firms to create an efficient financial system. B. bringing together buyers and sellers in a market. C. negotiating terms of repayment when agreements between buyers and sellers are in default. D. government intervention in a financial market.
When the euro falls in value relative to other currencies, then
A. European exports rise in price. B. neither European exports nor imports rise in price. C. both European exports and imports rise in price. D. goods imported into Europe rise in price.