Which of the following best describes the implications of the law of comparative advantage? If each person sells goods for which he or she has the greatest comparative advantage in production and buys those for which his or her comparative advantage is least, the
What will be an ideal response?
total output available to each person can be expanded by specialization and exchange.
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Your scholarship depends on your maintaining a 3.5 cumulative GPA. Your GPA for last semester was 3.6, which brought your cumulative GPA down. What must be true?
A. Last semester's grades were lower than your overall GPA. B. Last semester's grades were higher than your overall GPA. C. If this semester's grades are the same as last semester's, you might lose your scholarship. D. If this semester's grades are the same as last semester's, your overall GPA will stay the same.
Transactions costs are the
A) costs of using the Coase theorem. B) opportunity costs of conducting a transaction. C) external marginal costs of the externality. D) reason why taxes cannot affect the inefficiency resulting from an external cost. E) external costs when a firm pollutes.
Which of the following is correct concerning opportunity cost?
a. Except to the extent that you pay more for them, opportunity costs should not include the cost of things you would have purchased anyway. b. To compute opportunity costs, you should subtract benefits from costs. c. Opportunity costs and the idea of trade-offs are not closely related. d. Rational people should compare various options without considering opportunity costs.
Refer to Scenario 9.6 below to answer the question(s) that follow. SCENARIO 9.6: Celeste borrowed $40,000 from her brother to open a car wash. She pays her brother a 5% yearly return on the money he lent her. Her other yearly fixed costs equal $18,000. Her variable costs equal $40,000. In her first year, Amy sold 40,000 car washes at a price of $2.50 per car wash.Refer to Scenario 9.6. Celeste's total costs equal
A. $20,000. B. $40,000. C. $60,000. D. $100,000.