The ability to produce at a lower opportunity cost than someone else is referred to as:
a. absolute advantage
b. comparative advantage.
c. absolute superiority.
d. competitive disadvantage.
b
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Suppose that the quantity of cars demanded exceeds the quantity of cars supplied. We would expect that
A) the price of cars will increase. B) the price of cars will decrease. C) the supply will increase (supply will shift to the right) to meet the demand. D) the demand will decrease (demand will shift to the left) to meet the supply.
Which of the following is the correct statement of the marginal rule for optimal input proportions? The input proportion is optimal when
A. PA= PB. B. MPPA= MPPB. C. PA×MPPA= PB×MPPB. D. PA/PB= MPPA/MPPB.
A manager believes there is a 5 percent chance their firm will have to pay $1,000,000 and a 95 percent chance they will be found innocent and pay nothing except the legal fees of $100,000. If the manager chooses to not enter into the litigation and to settle for $150,000 (pay the plaintiff), which of the following is true?
A) The manager is a risk lover. B) The manager is risk neutral. C) The manager is risk intolerant. D) The manager is risk averse.
Describe the difference between business-cycle macroeconomics and economic-growth macroeconomics