Which of the following statements is true?
A. Specialization and trade along the lines of comparative advantage allows nations to consume more than if they were to produce just for themselves.
B. Free trade theory suggests that when trade takes place any gains made by one nation comes at the expense of another.
C. According to the theory of comparative advantage, a nation should specialize in the production of those goods for which it has an absolute advantage.
D. One country can have the comparative advantage in both goods, but it can only have the absolute advantage in one good as long as the opportunity costs are different.
Answer: A
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Monetary policy has one clear advantage over fiscal policy by virtue of its very short
A) data lag. B) data and recognition lags. C) legislative and transmissions lags. D) effectiveness lag.
The Pareto superiority concept _____
a. is equivalent to utilitarianism b. is equivalent to equilibrium in a perfectly competitive market c. compares two different states of the world d. looks at a state of the world and judges its superiority
Other things equal, if the labor input grows faster than total output, total factor productivity falls
a. True b. False Indicate whether the statement is true or false
If you were going to expand a facility by adding 10% more seats, but because of the location of those seats the costs of providing ushers and other personnel to deal with the new seats was rising (on a per seat basis), the new MC curve would look like the previous one, except that it would
A. no longer be a backward L but would be upward sloping once the old capacity was reached. B. just shift up. C. just shift to the right. D. just shift to the left.