Trade creates value by
a. moving goods from people who value the goods less to people who value the goods more.
b. permitting trading partners to expand output through specialization in areas where they each have a comparative advantage.
c. permitting trading partners to expand output through the adoption of mass production methods.
d. all of the above.
D
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Based on the answer above, the price for bus rides _____________ and the quantity demanded for bus rides ____________
a. Increase; increase b. Increase; decrease c. Decrease; increase d. Decrease, decrease
In the real world, the actual multiplier is ____ the simplified multiplier
a. much larger than b. slightly larger than c. equal to d. slightly smaller than e. much smaller than
Which of the following must be true if average variable costs are decreasing?
a. Average fixed cost exceeds average total cost. b. Marginal cost exceeds average variable cost. c. Marginal cost is less than average variable cost. d. Marginal cost is less than average total cost.
Recall the Application about craft beer and the increase in the price of hops to answer the following question(s).Recall the Application. An increase in the production of beer resulted in the demand for hops because hops are ________ to beer.
A. inputs B. completely unrelated C. complements D. substitutes