It is possible to have a comparative advantage in producing a good or service without having an absolute advantage
Indicate whether the statement is true or false
TRUE
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Widespread acceptance of the Keynesian theory of fiscal policy
a. caused most economists to reject the public choice view of budget deficits. b. relaxed the political pressure to balance the budget and, hence, paved the way for the persistent budget deficits of the last five decades. c. was based on the view that continual budget deficits would help stabilize the economy. d. increased the pressure for a constitutional amendment mandating that the federal government balance its budget.
If consumers spend 85 cents out of every extra dollar received, the:
A. MPC is 0.85. B. MPC is 0.15. C. MPC is 6.67. D. MPS is 0.85.
In a thin market:
A. only high-quality goods are sold. B. some high-quality goods are sold, but fewer than would be sold in a market with perfect information. C. some low-quality goods are sold, but fewer than would be sold in a market with perfect information. D. no high-quality goods are sold.
Suppose that in Slovakia one unit of labor can produce either 20 tons of wheat or 40 tons of soy and in Poland one unit of labor can produce either 40 tons of wheat or 20 tons of soy. If each country has two units of labor, which of the following consumption combinations can be attained only with trade?
A. Slovakia consumes 80 tons of soy. B. Poland consumes 40 tons of wheat and 20 tons of soy. C. Slovakia consumes 30 tons of both soy and wheat. D. Poland consumes 80 tons of wheat.