What determines a country's limits to acceptable terms of trade?
A. Their opportunity costs in production.
B. Whether they possess the absolute advantage in the production of a good.
C. How much a country likes a good for which they are trading.
D. When a country has a comparative advantage in production of both goods.
A. Their opportunity costs in production.
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Draw a graph of a market in equilibrium. Describe what might cause a change in demand or supply and how this would affect the diagram. Indicate how the equilibrium price and quantity will change.
What will be an ideal response?
A cartel maximizes industry profit by:
a. eliminating quotas. b. producing at the kink in its demand curve. c. producing where MR = MC. d. giving secret price concessions. e. producing more output than a monopoly would.
The difference between a firm's total revenues and total costs when all explicit and implicit costs are included is the firm's
a. economic profit. b. accounting profit. c. opportunity cost of capital. d. long-run average total cost.
If the national debt is owed to foreigners,
A. the debt constitutes a burden to domestic citizens. B. economic growth will necessarily be higher than if the debt were owed to domestic citizens. C. paying off the debt will involve a transfer of resources within the country. D. future interest payments on the debt are not a burden to the nation.