When one country can produce a good more efficiently than another country:
A. that country should produce that good and be the sole "winner" of trade.
B. that country can specialize in that good and choose only to export goods.
C. both can specialize in the industry in which they have comparative advantage and experience mutual gains.
D. that country has no basis for trading with another nation.
C. both can specialize in the industry in which they have comparative advantage and experience mutual gains.
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Refer to the figure above. When the supply curve of flash drives is S1 and the demand curve for flash drives is D, what is the shortage in the market when the price is $5?
A) 50 units B) 40 units C) 10 units D) 0 units
Recall the Application. One difference between a value-added tax and an income tax is the value-added tax
A) is a progressive tax. B) is not a consumption tax. C) does not penalize individuals who save. D) is difficult to collect.
Refer to Figure 9.7. Because of the policy, consumer surplus fell by
A) $10. B) $20. C) $12,500. D) $25,000. E) $45,000.
Which of the following is true?
a. Competitive behavior is present in the market sector but not in the public sector. b. Because candidates for public office represent a bundle of views, there is more ability for individuals to make their preferences count on specific issues than in the market sector. c. When decisions are made democratically, the economic and political power of all individuals will be equal unlike in the market sector. d. The reality of the aggregate consumption-aggregate payment link imposed by scarcity is present in both the market and public sectors.