Missouri can produce 10,000 tons of pecans per year or 5,000 tons of pears per year. Washington can produce 12,000 tons of pecans per year or 48,000 tons of pears per year. Which of the following statements is TRUE?
A) Washington has an absolute advantage in the production of both pecans and pears.
B) Washington has a comparative advantage in the production of both pecans and pears.
C) Washington has a comparative advantage in producing pecans and Missouri has a comparative advantage in producing pears.
D) Both answers A and C are correct.
A
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The pre-Keynesian or classical economic theory predicted that in the long-run the economy would experience:
a. long periods of high unemployment. b. rising rates of inflation. c. only temporary periods of high unemployment. d. idle factors of production.
Which of the following carries out surveys to measure international trade in services?
a. Census Bureau b. Department of Trade c. Bureau of Economic Analysis d. Department of the Treasury