A country has a comparative advantage in the good that it can produce
a. at a lower cost in terms of other goods.
b. using fewer resources than its trading partner uses.
c. at a lower cost than its trading partner can produce.
d. using more resources than its trading partner uses.
a. at a lower cost in terms of other goods.
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In the simple accelerator theory an increase in expected sales will
A) lead to an increase in net investment. B) not necessarily lead to an increase in net investment. C) lead to an immediate increase in replacement investment. D) lead to an increase in net investment in the following period.
If you had a two regressor regression model, then omitting one variable which is relevant
A) will have no effect on the coefficient of the included variable if the correlation between the excluded and the included variable is negative. B) will always bias the coefficient of the included variable upwards. C) can result in a negative value for the coefficient of the included variable, even though the coefficient will have a significant positive effect on Y if the omitted variable were included. D) makes the sum of the product between the included variable and the residuals different from 0.
A price floor is a reasonable price control mechanism to impose in cases where the government believes the market's equilibrium price
a. creates an excess supply that will force price downward b. is too high c. creates an excess demand that will force price upward d. is too low e. is higher than the market price
Average fixed costs rise continuously as quantity of output rises.
Answer the following statement true (T) or false (F)