Suppose that the opportunity cost of producing goods differs between two nations. We can correctly state that
A. neither country has a comparative advantage in the production of any good.
B. the two nations should not specialize in the production of goods.
C. specialization can lead to a decrease in the production of all goods.
D. specialization can lead to an increase in the production of all goods.
Answer: D
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The marginal cost curve is
A) downward sloping to reflect the bowed out PPF. B) downward sloping as marginal benefits increase. C) upward sloping because marginal cost falls as more of a good or service is produced. D) upward sloping to reflect the increasing opportunity cost of producing one more unit. E) U-shaped to reflect the bowed out PPF.
Which of the following is TRUE regarding marginal benefit? I) The marginal benefit curve shows the benefit firms receive by producing another unit of a good. II) Marginal benefit increases as more of a good is consumed
A) I and II B) I only C) II only D) neither I nor II