Fab Tools Inc can produce 150 widgets and 100 axes in a month. Another company AllMyTools Inc can produce 180 widgets and 50 axes per month. Which of the following statements is true?
a. Fab Tools has a comparative advantage in the production of widgets.
b. Fab Tools has an absolute advantage in the production of both goods.
c. AllMyTools has a comparative advantage in the production of widgets.
d. AllMyTools has an absolute advantage in the production of both goods.
C
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How would each of the following events affect Cheryl Shirker's supply of labor?
(a) Cheryl's firm announces a reorganization plan, in which she will get a big promotion and raise in six months. (b) Cheryl's speculative investment in plutonium futures pays off big, netting her a profit of $300 thousand. (c) Cheryl's father, who had planned to leave her a large bequest, must spend all his wealth on medical bills after a prolonged illness.
According to the graph shown, if this economy were to open to trade, surplus would:
This graph demonstrates the domestic demand and supply for a good, as well as the world price for that good.
A. increase overall.
B. decrease for the producer.
C. transfer from producer to consumer.
D. increase for the consumer.
In a perfectly competitive market, an increase in market demand in a long-run constant-cost industry causes:
A. a decrease in price, a decrease in quantity, and a decrease in profit in the short run. B. an increase in price, quantity, and profit in the long run. C. an increase in price, quantity, and profit in the short run. D. a decrease in price, a decrease in quantity, and a decrease in profit in the long run.
Refer to the information provided in Scenario 25.2 below to answer the question(s) that follow.SCENARIO 25.2: The following table shows the changes in deposits, reserves, and loans of 4 banks as a result of a $100,000 initial deposit in Bank No. 1. Assume all banks are loaned up.
Refer to Scenario 25.2. If the required reserve ratio were changed to 20%, total loans of Bank No. 2 will change to
A. $64,000. B. $72,000. C. $74,250. D. $80,000.