You have an absolute advantage whenever you
A) are better educated than someone else.
B) can produce more of something than others with the same resources.
C) prefer to do one particular activity.
D) can produce something at a lower opportunity cost than others.
Answer: B
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Assume that you have won a prize of $10,000. Make a list of how you would spend and save the money, from most important to least important.
What will be an ideal response?
A capital inflow occurs when:
A. money saved domestically is invested in another country. B. money saved in another country finances domestic investment. C. there is a negative difference between capital inflows and capital outflows for a country. D. there is a positive difference between capital inflows and capital outflows of a country.
If a nation experiences severe drought and real risk-free interest rate rises, then:
a. Aggregate demand rises, and aggregate supply falls. b. Aggregate demand rises, but aggregate supply does not change. c. Aggregate demand falls, and aggregate supply rises. d. Aggregate demand and aggregate supply rise. e. Aggregate demand and aggregate supply fall.
The basic idea of the theory of contestable markets is that when the cost of entry and exit is very low, the threat of entry can be sufficient to produce an allocation similar to the one we see under
A. monopolistic competition. B. oligopoly. C. perfect competition. D. monopoly.