The first example used to explain comparative advantage used two countries (England and Portugal) and two goods (wine and cloth) to show that
A) each country would be better off from trade if it had an absolute advantage in producing one of the goods.
B) each country would have a comparative advantage in the production of the good for which it had an absolute advantage.
C) mutually beneficial trade was possible between two countries even if one had a comparative advantage in the production of both goods.
D) mutually beneficial trade was possible between two countries even if one had an absolute advantage in the production of both goods.
D
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Which of the following is a difference between an oligopoly model with homogeneous products and a monopoly?
A) Firms in an oligopoly with homogeneous products earn positive economic profits in the long run, while a monopoly earns zero economic profits in the long run. B) Firms in an oligopoly with homogeneous products face stiff competition from its rivals, while there is no competition in a monopoly. C) There are huge barriers to entry in an oligopoly with identical products, while there are no barriers to entry in a monopoly. D) Firms in an oligopoly with identical products charge a price higher than marginal cost in the long run, while a monopoly charges a price lower than marginal cost in the long run.
The origin of the idea of a trade-off between inflation and unemployment was a 1958 article by
A) A.W. Phillips. B) Edmund Phelps. C) Milton Friedman. D) Robert Gordon.
When the Fed increases the money supply, interest rates:
a. rise. b. fall. c. are unaffected. d. rise and then fall. e. fall and then rise.
When the economy is operating below full-employment capacity, a recessionary gap is said to exist
Indicate whether the statement is true or false