Comparative advantage is defined as
A. the ability to produce more output from given inputs of resources than others can.
B. the ability to use more input of resources than others can.
C. having a lower average fixed cost in the production of a good than does someone else.
D. the ability to produce more output of one good relative to another good than another country can.
Answer: D
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The demand and supply schedules for pizza are in the table above. If the government sets a maximum legal price of $2 per slice of pizza, then
A) there is a shortage of 20 slices of pizza. B) this maximum price is an example of a price floor. C) this maximum price is an example of a price ceiling. D) Both answers A and C are correct. E) Both answers B and C are correct.
Big Roads and Big Pavers are two competing road construction firms. The managers of these two firms should never undertake all of the following actions except which one?
A) agree to submit a high bid on a contract B) agree to submit a low bid on a contract C) agree to the number of contracts the firms will bid on D) share information and experiences from implementing new government safety standards
Which of the following is an example of a public good?
A. health care B. college education C. flood control D. post office
How do a partnership and a corporation differ?
A) Partnerships have unlimited liability while corporations have limited liability. B) Corporations can issue stocks and bonds, while partnerships cannot. C) Corporations face more taxes than do partnerships. D) All of these are differences between the two types of businesses.