Assume that Germany can produce 10 million bottles of beer or 4 million bottles of vodka. Further assume that Russia can produce 7 million bottles of beer or 3 million bottles of vodka. As a result, which of the following is true with regard to absolute and comparative advantage?
a. Germany has the absolute advantage in beer and the comparative advantage in beer.
b. Germany has the absolute advantage in beer and the comparative advantage in vodka.
c. Russia has the absolute advantage in beer and the comparative advantage in beer.
d. Russia has the absolute advantage in beer and the comparative advantage in vodka.
a
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Real estate suitable for condominium development is also suitable for single-family home development. Therefore, a rise in the price of condominiums relative to single-family homes tends to
A) increase the opportunity cost of building new single-family homes. B) reduce the demand for condominiums. C) increase the demand for condominiums. D) do none of the above.
George donates money for charity only when somebody he knows approaches him for such donations. This is an example of ________
A) rationalism B) impure altruism C) pure altruism D) liberalism
A country in which a substantial amount of the factories and stores that produce domestic goods and services are foreign-owned is most likely a country in which
A) GDP is much larger than GNP. B) GNP is much larger than GDP. C) GDP is roughly equal to GNP. D) the relationship between GDP and GNP no longer exists.
How does government support of health and education programs foster economic growth?
What will be an ideal response?