The improvement in outcomes that occurs when specialized producers exchange goods and services is called:
A. gains from trade.
B. absolute advantage.
C. comparative advantage.
D. specialization.
A. gains from trade.
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In the country of Darrowby, net domestic income at factor cost is $2.0 million. Gross domestic product is $3.0 million, and depreciation is $0.5 million. Indirect taxes less subsidies ________
A) are $1 million B) are $0.5 million C) cannot be calculated D) are -$0.5 million
Which factor receives the profit from production?
a. land b. labor c. capital d. entrepreneurship
What is money’s primary function?
a. to act as a medium of exchange b. to be a store of value c. to allow for deferred payments d. to act as a unit of account
Pure monopolies are said to be allocatively inefficient because ________.
A. price is greater than marginal cost B. they produce where MR > MC C. price is less than marginal cost D. price is equal to marginal cost