To obtain the gains available from comparative advantage, individuals or countries must do more than ...

To obtain the gains available from comparative advantage, individuals or countries must do more than specialize; they must also
 
  A) save.
  B) invest.
  C) engage in research and development.
  D) trade.

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Ques. 2

If the money prices of resources changes, the SAS curve shifts.
 
  Indicate whether the statement is true or false

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Ques. 3

The above table shows Priscilla's marginal utility from the two goods she consumes, pizza and Pepsi. The price of a slice of pizza is 2 and of a can of Pepsi is 1. Suppose Priscilla has 6 to spend. If Priscilla chooses to eat 3 slices of pizza
 
  A) she is maximizing her total utility.
  B) she is not equating marginal utility per dollar for pizza and Pepsi.
  C) she is not at a consumer equilibrium.
  D) Both answers B and C are correct.

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Ques. 4

Suppose the marginal cost of producing a good falls so that the marginal social cost curve shifts downward. Then the efficient quantity to produce of that product
 
  A) increases.
  B) does not change.
  C) decreases.
  D) could increase, stay the same, or decrease.

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Ques. 5

The elasticity of supply measures the sensitivity of
 
  A) supply to changes in costs.
  B) quantity supplied to quantity demanded.
  C) quantity supplied to a change in price.
  D) price to changes in supply.