The principle of comparative advantage asserts that
a. not all countries can benefit from trade with other countries.
b. the world price of a good will prevail in all countries, regardless of whether those countries allow international trade in that good.
c. countries can become better off by exporting goods, but they cannot become better off by importing goods.
d. countries can become better off by specializing in what they do best.
d
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Paul has the utility function U(q1,q2 ) = q1q2. If Paul consumes q1 = 4 and q2 = 2 his Marginal Rate of Substitution is
A) -2. B) 1. C) -1. D) -1/2.
Consider the following three bonds, Bond F, Bond J and Bond P. Bonds F and P mature in 1 year while Bond J matures in 2 years. Bond F and J have a face value of $10,000 while Bond P has a face value of $12,000 . If the interest rate is 15%, rank the three bonds from highest present value to lowest present value
a. Bond F, Bond P, Bond J b. Bond P, Bond F, Bond J c. Bond J, Bond F, Bond P d. Bond P, Bond J, Bond F e. Bond F, Bond J, Bond P