Suppose that with 1 unit of labor, Canada can produce 40 TVs or 20 computers. With 1 unit of labor, Taiwan can produce 30 TVs or 10 computers. Which of the following is correct?
a. Taiwan has a comparative advantage in the production of computers.
b. Canada has an absolute advantage in the production of neither good.
c. Canada has a comparative advantage in the production of computers.
d. Taiwan has an absolute advantage in the production of computers.
e. Taiwan has an absolute advantage in the production of TVs.
c
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How does the United States compare to other advanced, industrialized economies on the issue of openness?
A. The U.S. economy is completely closed. B. The U.S. economy is at the low end of openness. C. The U.S. economy is above average in openness. D. The U.S. economy is among the most open. E. The U.S. economy is the most open of any economy.
Given that the world is filled with uncertainty
A) managers need to assess the probabilities of certain outcomes. B) managers need to avoid using game theory, as it is too complex to be of any help. C) managers need to hire statisticians to calculate expected values. D) none of these choices.
The “law” of diminishing returns is what happens to marginal returns as all inputs are varied.
Answer the following statement true (T) or false (F)
The political business cycle theory predicts that
A) the Fed acts to promote the interests of the general public. B) the Fed acts to stimulate economic activity before an election. C) the President's appointments to the Board of Governors will usually be politicians. D) political factors over which the Fed has no control are most important in explaining the business cycle.