If apples and pears have equivalent opportunity costs,
a. it makes no difference what the economy produces, pears or apples
b. the economy always gains from producing more and trading the other
c. the production possibilities curve is bowed out
d. one apple trades for two pears
e. one apple trades for one pear
E
You might also like to view...
Bonnie can produce either 20 hats or 10 scarves in a month. Phil can produce either 5 hats or 10 scarves in a month. Therefore:
A) Phil has a comparative advantage in hats, Bonnie in scarves. B) Bonnie has a comparative advantage in hats, Phil in scarves. C) Phil has a comparative advantage in both hats and scarves. D) Bonnie has a comparative advantage in both hats and scarves. E) Neither of them has a comparative advantage in scarves.
Supermarkets will frequently not carry the products of food processors unless the processors pay fees to the supermarkets because
A) supermarkets are cartels. B) supermarkets often dominate the geographic areas in which they sell. C) supermarkets stand between the food processors and the ultimate consumers. D) supermarket shelves are scarce goods. E) supermarkets typically have more bargaining power than food processors.
By referring to Figure 7-1, an increase in the money stock
a. shifts the LM schedule to the right from LM0 to LM1. b. shifts the LM schedule to the left from LM0 to LM2. c. leaves the LM curve unchanged at LM0. d. shifts neither the IS nor the LM schedule.
What type of transaction does GDP not include?