If a nation specializes in activities in which opportunity costs are the lowest and then trades with other nations, it is most likely to:
a. have a higher standard of living for its citizens than it would if it did not specialize and then trade.
b. have a lower standard of living for its citizens than it would if it did not specialize and then trade.
c. create as much wealth for its citizens as it could if it did not specialize and then trade.
d. benefit in the short run but incur heavy loss in the long run.
e. incur heavy loss in the short run and eventually cease production in the long run.
a
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The marginal revenue curve of a competitive firm is
a. U-shaped. b. a ray from the origin. c. a horizontal line at the market price. d. downward sloping.
If the share of population employed in two countries is the same, average living standards will be higher in the country with:
A. lower average labor productivity. B. higher average labor productivity. C. the smaller population. D. the larger population.
If a perfectly competitive firm’s average total cost curve is above its demand schedule at every level of output, then the firm will earn _______ profits.
A) positive B) breakeven C) negative D) zero
If the price of gasoline rises by 10 percent and new car sales fall by 5 percent, this indicates that these two goods are complementary.
Answer the following statement true (T) or false (F)