Answer the next question based on the data provided in the tables below for two hypothetical nations, Wat and Xat. The nations have the following production possibilities for rice and corn:Wat's Production Possibilities ABCDEFRice7506004503001500Corn050100150200250Xat's Production Possibilities ABCDEFRice2,5002,0001,5001,0005000Corn0100200300400500Assume that Wat originally produced rice and corn at combination C and that Xat originally produced combination B. If the nations now fully specialized based on comparative advantage, the total gains from specialization and trade are
A. 50 units of rice and 50 units of corn.
B. 100 units of rice and 150 units of corn.
C. 100 units of rice and 100 units of corn.
D. 25 units of rice and 25 units of corn.
Answer: A
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Recessions begin at ________ and end at ________.
A. a peak; a trough B. the highest unemployment rate; the lowest unemployment rate C. a trough; a peak D. the lowest unemployment rate; the highest unemployment rate
By producing less, a firm can reduce
A) its fixed costs and its variable costs. B) its fixed costs but not its variable costs. C) its variable costs but not its fixed costs. D) neither its variable costs nor its fixed costs.
Which market type has characteristics as follows: large number of firms, differentiated product?
A) perfect competition B) monopolistic competition C) oligopoly D) monopoly
The presence of negative externalities leads to a misallocation of societal resources because: a. whenever external costs are imposed on outside parties, the good should not be produced at all
b. less of the good than is ideal for society is produced. c. there are some costs associated with production that the producer fails to take into consideration. d. the government always intervenes in markets when negative externalities are present, and the government is inherently inefficient.