Developing countries should
What will be an ideal response?
focus on production based on comparative advantage.
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According to the quantity theory of money, changes in the price level are the result of changes in the
A) prime interest rate. B) real interest rate. C) quantity of money. D) velocity of circulation.
When a monopolistically competitive firm lowers its price, one good thing happens to the firm. What is this "one good thing" called?
A) the income effect B) the price effect C) the substitution effect D) the output effect
Rent-seeking behavior creates:
A. waste and inefficiency. B. waste, but is efficient. C. inefficiencies, but not waste. D. efficiency without waste.
Caroline sharpens knives in her spare time for extra income. Buyers of her service are willing to pay $2.95 per knife for as many knives as Caroline is willing to sharpen. On a particular day, she is willing to sharpen the first knife for $2.00, the second knife for $2.25, the third knife for $2.75, and the fourth knife for $3.50 . Assume Caroline is rational in deciding how many knives to
sharpen. Her producer surplus is a. $0.95. b. $1.15. c. $1.30. d. $1.85.