The law of comparative advantage explains which of the following?
What will be an ideal response?
Specialization and exchange will make it possible for trading partners to expand their combined output.
You might also like to view...
Producer surplus equals
A) total revenue minus total variable cost. B) total revenue minus the sum of all marginal cost. C) profit plus fixed cost. D) All of the above.
Price discrimination occurs when
a. price exceeds marginal cost b. a firm charges different customers different prices, and the differences are not explained by cost factors c. price exceeds average cost d. a firm charges different customers different prices, where these differences are based on cost differences e. price equals average variable cost
Which of the following would be the most likely outcome if all perfectly competitive firms in a product market join together to form a monopoly?
A) Both the rate of output and the quantity of labor input employed will decrease. B) Both the rate of output and the quantity of labor input employed will increase. C) The rate of output in the market will increase but the quantity of labor input will decrease. D) The rate of output in the market will decrease but the quantity of labor input will increase.
All else equal, an increase in government borrowing is likely to cause a(n):
A) leftward shift of the credit demand curve. B) rightward shift of the credit demand curve. C) downward movement along the credit demand curve. D) upward movement along the credit demand curve.