Jose and Maria work at a restaurant. Jose can make either 10 pancakes or 4 waffles; Maria can make either 8 pancakes or 2 waffles. According to this scenario
A) Maria has the absolute advantage in making waffles.
B) Jose has the absolute advantage in making waffles.
C) Maria has the comparative advantage in making waffles.
D) Jose has the comparative advantage in making pancakes.
Answer: B
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If a monopolist sets a low price to discourage potential competitors from entering the market, it is referred as
A) price skimming. B) predatory pricing. C) penetration pricing. D) limit pricing.
The Keynesian equilibrium is defined to be when:
A. planned inventories equal to actual inventories, which leads to national income equal to planned aggregate expenditure. B. planned investment is equal to domestic consumption. C. planned inventories equal to actual inventories, which leads to national net income equal to planned aggregate expenditure. D. planned spending is equal to expected spending from households.
If demand rises and supply rises, equilibrium price will _____ and equilibrium quantity will _____.
Fill in the blank(s) with the appropriate word(s).
If the marginal propensity to consume is very close to zero, then the multiplier
A) cannot be calculated. B) is very close to one. C) is very large. D) is very close to zero. E) might be negative if the marginal tax rate is large enough.