According to the concept of comparative advantage, a good should be produced in that nation where:
A. its domestic opportunity cost is greatest.
B. money is used as a medium of exchange.
C. its domestic opportunity cost is least.
D. the terms of trade are maximized.
C. its domestic opportunity cost is least.
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Adam Smith’s diamond-water puzzle
A. can be resolved by distinguishing between marginal and total utility. B. occurs because diamonds have no utility. C. occurs because scarcity increases total utility. D. will likely never be resolved with existing economic tools.
Which of the following is definitely NOT an example of a natural monopoly?
A) local water distribution companies B) urban rail services C) local electric power and gas distribution companies D) urban retail stores
Suppose a tax has been imposed in the graph shown. Which kind of tax is most likely demonstrated by this graph?
A. A tax on sellers
B. A tax on buyers
C. A tax on big corporations
D. A price ceiling
A technological advance that increases labor productivity will
a. lower wages. b. decrease the demand for labor as fewer workers are needed. c. decrease the supply of labor as fewer workers are needed. d. increase the demand for labor as MP rises. e. decrease the demand for labor as MP falls.