Refer to the figure shown, which represents the production possibilities frontiers for Countries A and B. Considering both country's production possibilities frontiers, we can infer that Country A will specialize in:
A. trucks, and be willing to accept no more than 5 cars for each truck.
B. cars, and be willing to give no more than 5 cars for each truck.
C. trucks, and be willing to accept no less than 5 cars for each truck.
D. cars, and be willing to give no less than 5 cars for each truck.
Answer: B
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The basic economic problem is a situation of
A) limited resources and unlimited wants. B) both limited resources and limited wants. C) limited incomes and unlimited choices. D) unlimited incomes and limited choices.
A typical supply curve has
a. slope equal to zero. b. slope equal to infinity. c. negative slope. d. positive slope. e. constant slope.
According to the equimarginal principle, if the marginal cost of an activity outweighs the marginal benefit, then
a. the activity should not be pursued at all. b. less of the activity should be undertaken. c. the net total benefit received from the activity is negative. d. people should expand their pursuit of the activity.
Cooperation between oligopolistic firms is difficult because
A. each firm has a monopoly power on its own product. B. firms rarely have mutual interests. C. firms gain more through competition. D. each firm has an incentive to "cheat" on the agreements made.