Suppose Hank and Tony can both produce corn. If Hank's opportunity cost of producing a bushel of corn is 2 bushels of soybeans and Tony's opportunity cost of producing a bushel of corn is 3 bushels of soybeans, then Hank has the comparative advantage in the production of corn
a. True
b. False
Indicate whether the statement is true or false
True
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Which of the following is not an example of a trade restriction?
A) quotas and voluntary export restraints B) tariffs C) consumer preferences for goods produced domestically D) legislation requiring that cars sold in a country have a 50 percent domestic content
If national saving increases, ________. (Assume that the capital account is zero and net transfers are zero.)
A) the sum of domestic investment and net exports must decrease B) the sum of domestic investment and foreign investment must decrease C) the sum of domestic investment and foreign investment must increase D) foreign investment must decrease to cover the gain
Do donor countries gain anything from their aid?
What will be an ideal response?
Changing the price of a good will usually result in a negative externality
Indicate whether the statement is true or false