Suppose that opportunity costs in India and Australia are constant. In India, maximum feasible hourly production rates are either 0.3 unit of cloth or 0.2 unit of food
In Australia, maximum feasible hourly production rates are either 0.5 unit of cloth or 0.5 unit of food. It is correct to state that
A) India has a comparative advantage in producing cloth.
B) India has a comparative advantage in producing both cloth and wheat.
C) India has no comparative advantage in producing cloth or wheat.
D) Australia has a comparative advantage in producing cloth.
A
You might also like to view...
The value of the multiplier ________ as the marginal propensity to save decreases
A) decreases B) increases C) is constant D) becomes negative
Refer to Scenario 14.4. Suppose that a subsidy is implemented on each unit of labor hired. Then the number of workers hired
A) will decrease. B) will increase. C) will not change. D) will change in an indeterminate fashion.
Cindy discovers that when she goes to the beach, she does not have to bring her radio. She can put her blanket near someone who has a radio and listen all day (without having to carry her radio, get sand in her speakers, or buy new batteries). This is an example of:
a. private property abuse. b. external costs. c. a negative externality. d. a positive externality.
The U.S. economy is unique for both its size and prosperity
a. True b. False Indicate whether the statement is true or false