Tom and Jerry have two tasks to do all day: make dishes and build fences. If Tom spends all day making dishes, he will have make 16 dishes. If he instead devotes his day to building fences, Tom will build 4 fences. If Jerry spends his day making dishes, he will make 14 dishes; if he spends the day building fences, he will build 7 fences. After looking at the production possibilities for both Tom and Jerry, we can conclude that:
A. Tom has the comparative advantage in fence production.
B. No comparative advantage exists.
C. Jerry has the comparative advantage in dish production.
D. Tom has the comparative advantage in dish production.
Answer: D
You might also like to view...
In communism, central planners decide which of the following?
a. what goods and services will be produced
b. how much will be produced
c. who will produce and consume the goods and services
d. All of the above are correct.
If a firm is experiencing diseconomies of scale, then
A) proportional increases in all inputs result in proportional increases in output. B) the long-run average cost curve is rising as output expands. C) the long-run average cost curve is decreasing as output expands. D) the firm should expand the size of its operation.
Refer to the information provided in Figure 7.8 below to answer the question(s) that follow. 
Figure 7.8Refer to Figure 7.8 The firm?s isocost line could shift from CE to CD if
A. the price of capital increased. B. the price of labor increased by 33%. C. the firm?s total expenditures decreased by 33%. D. the firm?s total expenditures decreased by 33% or the price of capital and labor each increased by 50%.
The table below shows data regarding Germany's labor market
Year Labor Force (millions) Number of Employed (millions) Population (millions) 2006 43.7 39.01 82.3 2007 43.7 39.06 82.2 2008 43.6 39.8 82.1 The data show that Germany's unemployment rate between 2007 and 2008 A) increased. B) decreased C) stayed the same. D) cannot be determined because the population decreased.