Use the above table. Adam has 3 apples and 3 oranges. Eve has 2 apples and 2 oranges. Eve asks Adam to give her an apple in exchange for an orange. Should Eve go through with this exchange?
A. No. Adam likes apples more than oranges.
B. Yes. She is indifferent between consuming apples and oranges.
C. Yes. This way she will have 3 apples, which will give her more total satisfaction.
D. No. She gives up more satisfaction than she gets.
Answer: D
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Which of the following is the best measure of size of government as a share of the economy?
A) total government expenditures as a percentage of GDP B) the supply of money as a percentage of GDP C) public consumption plus private investment as a percentage of GDP D) private consumption as a percentage of Gross Domestic Product
Demand is more inelastic for an item which is a luxury as compared to an item which is a necessity.
Answer the following statement true (T) or false (F)
When market price is above equilibrium price
A. a shortage is generated. B. market price will rise. C. quantity supplied is greater than quantity demanded. D. None of these choices are correct.
According to the Heckscher-Ohlin model, the source of comparative advantage is a country's
A) factor endowments. B) technology. C) advertising. D) human capital. E) political system.