The principle of comparative advantage explains specialization and trade among countries but not among individuals
a. True
b. False
Indicate whether the statement is true or false
False
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If two countries agree to specialize and trade based on comparative advantage, which of the following is most likely to be TRUE?
A) Both of the countries will consume outside their respective production possibilities curves. B) One of the countries will end up receiving all of the gains from trade. C) One of the countries will both consume and produce on its production possibilities curve. D) Only one of the countries will produce on and consume outside its production possibilities curve.
In the linear breakeven model, the difference between selling price per unit and variable cost per unit is referred to as:
a. variable margin per unit b. variable cost ratio c. contribution margin per unit d. target margin per unit e. none of the above
A util represents a unit of measurement for the:
a. dollars a consumer spends on a good. b. profit a firm makes from producing a good. c. way a consumer will respond to a change in price. d. happiness a person obtains from consuming a good. e. way a producer will respond to a change in price.
When both exports and imports are considered, the major advantage of international trade is that it allows us to:
a. sample foreign products that many of us would otherwise never see. b. consume a larger, more diverse quantity of goods and services at lower prices than would otherwise prevail. c. share our technology and efficiency with less-developed countries that would otherwise never have the opportunity to observe modern goods and services. d. maintain jobs for workers who would otherwise have little to do.