Suppose Paraguay can produce 12 wheat or 3 corn. Suppose Bolivia can produce 4 wheat or 2 corn. Suppose opportunity costs are constant. Given these production possibilities,
A) Paraguay has a comparative advantage in wheat.
B) Paraguay has a comparative advantage in corn.
C) Paraguay has a comparative advantage in both goods.
D) Paraguay has an absolute advantage in neither good.
A
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A ham and cheese sandwich at the local deli costs $4.99 in 2005. If the CPI in 2005 was 90.0 and the CPI today is 121.0, the equivalent price for the ham and cheese sandwich today is
A) $6.71. B) $5.29. C) $4.99. D) $6.04. E) $5.54.
Uncertainty about inflation: a. shifts the attention of business managers away from exchange rate movements and toward concerns about productivity. b. reduces the difficulty of making international business decisions
c. make suppliers link the selling prices of their goods to the overall inflation rate. d. undermines money's importance as a link between the present and the future. e. makes contracts easier to negotiate.
People are forced to make choices because of:
a. unlimited wants and unlimited resources. b. limited wants and unlimited resources. c. unlimited wants and limited resources. d. limited wants and limited resources. e. irrational wants and limited resources.
"As income rises, the demand for most goods also rises." This statement
a. is inconsistent with the law of demand b. suggests that many goods are inferior goods c. shows that the quantity demanded is inversely related to price d. suggests that most goods are normal goods e. does not apply to goods traded in competitive markets