Mutually beneficial trade between two countries is possible only as long as
a. unit costs of production are the same no matter how many units are being produced
b. marginal costs rise as production increases
c. marginal costs are equal to average total costs
d. one country has an absolute advantage in the production of one good, while the other country enjoys a similar advantage in making another good
e. one country has a comparative advantage in the production of one good, while the other country enjoys a comparative advantage in making another good
E
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Policies to keep inflation in check ________
A) are, typically, fiscal policies B) are a potential cause of high unemployment C) are unlikely to be needed, so long as government spending remains high D) include increasing the quantities of money and saving E) are desirable in the short run, but may produce bad long-run outcomes
Supply-side economics calls for:
a. lower taxes on businesses and individuals. b. regulatory reforms to increase productivity. c. government subsidies to promote technological advance. d. All of these.
Politicians often point to wage differentials as evidence of labor-market discrimination against ethnic minorities and women; however, economists argue against this approach because people differ in the amount of human capital they have and the kinds of work they are willing and able to do
a. True b. False Indicate whether the statement is true or false
If the supply of dollars in the market for foreign-currency exchange shifts left, then the exchange rate
a. rises and the quantity of dollars exchanged falls. b. rises and the quantity of dollars exchanged does not change. c. rises and the quantity of dollars exchanged rises. d. falls and the quantity of dollars exchanged does not change.