Half of all your potential customers would pay $10 for your product but the other half would only pay $8 . You cannot tell them apart. Your marginal costs are $4 . If you set the price at $8, the expected profit is:

Explain the difference between absolute advantage and comparative advantage

What will be an ideal response?

If the real interest rate were -7%, this is:

a. A clear sign that it is better to borrow than to lend. b. Not clear sign that it is better to borrow than to lend because this decision depends on expected inflation. c. Actually, it is impossible for the real interest rate to be -7% because the real interest rate can approach zero, but it can never be less than zero. d. A clear sign that it is better to lend than to borrow.