When one country can produce a good more efficiently than another country:
A. both can specialize in the industry in which they have comparative advantage and experience mutual gains.
B. that country can specialize in that good and choose only to export goods.
C. that country should produce that good and be the sole "winner" of trade.
D. that country has no basis for trading with another nation.
Answer: A
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The world distribution of income has become more equal since 1970 because
A) the distribution of income within most countries has become more equal. B) foreign aid programs from rich nations have increased in size and especially in effectiveness. C) average incomes in poor nations, such as China, have risen faster than average incomes in rich nations, such as the United States. D) None of the above answers are correct.
Much of the empirical evidence on the behavior of costs for real-world firms suggests that:
A) average costs functions are U-shaped as suggested by economic theory. B) for most firms, marginal costs are declining in the range in which the firms operate. C) for many firms, marginal and average variable costs are constant over wide ranges of output. D) there is no relationship between the marginal and average variable costs of production.
A firm that is currently producing at a level of output where marginal revenue is greater than marginal cost can increase profits by producing one more unit of output
a. true b. false
Answer the following statement true (T) or false (F)
1) The efficiency loss of a tax is the tax revenue collected by government minus the value of the public goods financed through the tax. 2) The greater the elasticity of demand and supply, the greater is the efficiency loss of a tax. 3) Economists agree that corporations always shift the corporate income tax to consumers by raising product prices. 4) Although state and local taxes are highly progressive, federal taxation is predominantly