Consider a two-country, two-commodity model. Each country has an increasing-cost production-possibility curve. In this model the amounts of the goods that are produced in a country in the no-trade situation are determined by:
A. the factor endowments in the economy.
B. total income in the economy.
C. the relative prices of the goods.
D. technology differences between the industries.
Answer: C
You might also like to view...
Suppose there are 11 buyers and 11 sellers, each willing to buy or sell one unit of a good, with values {$14, $13, $12, $11, $10, $9, $8, $7, $6, $5, $4,}. Assume no transaction costs and a competitive market, what is the equilibrium price in this market?
a. 7 b. 8 c. 9 d. 10
When the exchange rate appreciates in the short run and then depreciates to its original level in the long run, it implies that the foreign money supply has:
a. temporarily risen. b. permanently risen. c. temporarily fallen. d. permanently fallen.
Explain how Singapore delivers good quality health care with significantly less spending than the United States
What will be an ideal response?
Refer to the information provided in Figure 17.1 below to answer the question(s) that follow. 
Figure 17.1 Refer to Figure 17.1. Dmitri has two job offers when he graduates from college. Dmitri views the offers as identical, except for the salary terms. The first offer is at a fixed annual salary of $40,000. The second offer is at a fixed salary of $20,000 plus a possible bonus of $40,000. Dmitri believes that he has a 50-50 chance of earning the bonus. Dmitri's expected value from the first job offer is ________ and is ________ from the second job offer.
A. $40,000; $50,000 B. $20,000; $40,000 C. $40,000; $40,000 D. $40,000; $60,000