The production possibilities curve for guns and butter in both Canada and the U.S. are straight lines. Suppose for Canada, the opportunity cost of producing butter is 1/2 gun. What must the opportunity cost of producing butter in the U.S. be if it specializes in guns and Canada specializes in butter?
a. more than 2
b. 2
c. 1/2
d. less than 1/2
e. more than 1/2
E
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The market demand curve for a product:
A. is the demand of an individual consumer. B. will lie to the right of all of the individual demand curves for a product. C. graphically is the vertical sum of the individual demand curves. D. will lie below all of the individual demand curves for a product.
Retained earnings are the same thing as "plowback."
a. True b. False Indicate whether the statement is true or false
If the government imposes a binding price floor in a market, then the consumer surplus in that market will decrease
a. True b. False Indicate whether the statement is true or false
A market where there is only one seller, and buyers have no good alternative, is called
A. a monopoly. B. perfect competition. C. monopolistic competition. D. an oligopoly.