Alland can produce 48 units of food per person per year or 16 units of clothing per person per year, and Georgeland can produce 16 units of food per year or 8 units of clothing. Which of the following statements is true?
a. Alland has a comparative advantage, but not an absolute advantage, in producing clothing.
b. Alland should specialize in the production of clothing
c. Georgeland has both a comparative and an absolute advantage in producing clothing.
d. Alland should specialize in the production of food.
d
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There is always some economic rent whenever the:
A) demand for a factor is downward sloping. B) supply of a factor is upward sloping. C) supply and demand intersect. D) supply of a factor is horizontal.
In 2014, which of the following countries had the lowest ratio of exports to GDP?
A) Japan B) Switzerland C) Austria D) Netherlands E) United States
Refer to Exhibit 2-3. If PPF1 is the relevant production possibilities frontier, society may move to PPF2 as a result of
Which of the following is TRUE regarding the real wage rate? The real wage rate
I. is always greater than the money wage. II. measures the quantity of goods and services an hour's work can buy. A) only I B) only II C) both I and II D) neither I nor II