If the United States' production possibility frontier was flatter to the widget axis, whereas Germany's was flatter to the butter axis, we know that
A) the United States has no comparative advantage
B) Germany has a comparative advantage in butter.
C) the U.S. has a comparative advantage in butter.
D) Germany has comparative advantages in both products.
E) the U.S. has a comparative disadvantage in widgets.
B
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A shift of the supply curve of oil raises the price from $70 a barrel to $80 a barrel and reduces the quantity demanded from 40 million to 38 million barrels a day. You can conclude that the
A) demand for oil is elastic. B) demand for oil is inelastic. C) supply of oil is elastic. D) supply of oil is inelastic.
Jimmy’s java shop operates in a monopolistically competitive market. Jimmy’s current output is where average costs are minimized. If this is the case, we would expect Jimmy to
A. increase output and lower price. B. decrease output and Jimmy’s average costs would increase. C. continue production at the current level as Jimmy’s is operating at his best outcome. D. increase output and Jimmy’s average costs would decrease.
Unless two people who are producing two goods have exactly the same opportunity costs, then one person will have a comparative advantage in one good, and the other person will have a comparative advantage in the other good
a. True b. False Indicate whether the statement is true or false
Suppose that a consumer is currently at an optimum when consuming goods A and B. Which of the following must be TRUE?
A. The marginal utility to price ratio of A is equal to the marginal utility to price ratio of B. B. The price of A is equal to the price of B. C. The marginal utility of A is equal to the marginal utility of B. D. The total utility from A is equal to the total utility from B.