Assume Japan must forego producing 60 computers for each automobile it produces. Moreover, the United States can produce one automobile if it forgoes producing 80 computers. Which of the following is true?
a. The United States has a lower opportunity cost of producing automobiles.
b. The United States has a comparative advantage in producing automobiles.
c. Japan has a comparative advantage in producing computers.
d. No trade will occur between Japan and the United States.
e. Japan has a lower opportunity cost of producing automobiles.
E
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Refer to the above figure. A price support set at P3 will
A) lead to a surplus of Q3 minus Q1. B) lead to a shortage of Q3 minus Q1. C) lead to an equilibrium quantity of Q2. D) be ineffective.
At a price of $5, Sam buys 10 units of a product; when the price increases to $6, Sam buys 8 units. Martha says Sam's demand has decreased. Is Martha correct?
A. Yes, Martha is correct. Sam's demand has decreased. B. No, Martha is incorrect. Sam's demand has increased. C. No, Martha is incorrect. Sam's quantity demanded has decreased, and his demand has not changed. D. No, Martha is incorrect. Sam's quantity demanded has increased, and his demand has increased.
The members of the Clean City group report that the overuse of several gardens in a neighborhood has led to pollution. In order to protect the gardens, they allowed only the elderly to access the gardens. By taking this measure, they converted a _____ to a _____
a. private good; public good b. public good; merit good c. private good; club good d. public good; club good
Which of the following would cause the real exchange rate of the U.S. dollar to depreciate?
a. the U.S. government budget deficit decreases b. capital flight from foreign countries c. the U.S. imposes import quotas d. None of the above is correct.