For each watch that Switzerland produces, it gives up the opportunity to make 50 pounds of chocolate. Germany can produce 1 watch for every 100 pounds of chocolate it produces
Which of the following is true about the comparative advantage between the two countries?
A) Switzerland has the comparative advantage in chocolate.
B) Germany has the comparative advantage in watches and chocolate.
C) Germany has the comparative advantage in watches.
D) Switzerland has the comparative advantage in watches.
D
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Which of the following is a common method used by government to cope with the situation in which production of a good creates an external cost?
A) removing property rights B) subsidizing production C) marketable permits D) lottery E) vouchers
Shari and Mary have a business that provides personal fitness training services. They know that after raising their prices from $40 to $60 per hour, the quantity of hours they spent delivering training services fell from 90 to 50 hours per week. The demand for their services is:
a. inelastic, with a price elasticity coefficient greater than one. b. inelastic, with a price elasticity coefficient less than one. c. elastic, with a price elasticity coefficient greater than one. d. elastic, with a price elasticity coefficient less than one.
A currency appreciation is disinflationary and contractionary if the
a. inward shift of the aggregate demand curve due to the fall in exports exceeds the outward shift of the aggregate supply curve due to lower input prices. b. outward shift of the aggregate demand curve due to the rise in exports exceeds the outward shift of the aggregate supply curve due to lower input prices. c. outward shift of the aggregate demand curve due to the fall in exports exceeds the inward shift of the aggregate supply curve due to higher input prices. d. inward shift of the aggregate demand curve due to lower input prices exceeds the outward shift of the aggregate supply curve due to the rise in exports.
Rank the following state and local government expenditure categories from largest to smallest
a. education, health, highways b. education, highways, income security c. highways, education, public order and safety d. public order and safety, highways, health