If Canada imports fishing poles from Mexico and Mexico imports bacon from Canada, which of the following would explain this pattern of trade?
A) The opportunity cost of producing fishing poles in Canada is higher than the opportunity cost of producing bacon in Mexico.
B) Mexico has a higher opportunity cost of producing fishing poles than Canada, and Canada has a higher opportunity cost of producing bacon.
C) Mexico must have an absolute advantage in producing fishing poles and Canada must have an absolute advantage in bacon.
D) Mexico has a lower opportunity cost of producing bacon than Canada and Mexico has a comparative advantage in producing fishing poles.
A
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Environmental economics
a. is concerned mainly with the residual flow from economic activity back to nature b. focuses on the flow of resources from nature to economic activity c. recognizes that the flow of residuals back to nature is preventable d. none of the above
Define the following terms and explain their importance to the study of economics
a. principle of marginal productivity b. marginal physical product c. marginal revenue product d. derived demand e. economic rent
Competitive firms that earn a loss in the short run should
a. shut down if P < AVC. b. raise their price. c. lower their output. d. All of the above are correct.
The figure below shows the supply and demand curves for oranges in Smallville.
What is the marginal cost of producing the tenth pound of oranges?
A. $4 B. $2 C. $5 D. $3