If labor in Mexico is less productive than labor in the United States in all areas of production,
a. then neither nation can benefit from trade.
b. then Mexico can benefit from trade but the United States cannot.
c. then the United States will have a comparative advantage relative to Mexico in the production of all goods.
d. then both Mexico and the United States still can benefit from trade.
d
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The production possibilities frontier is used by economists to depict
A) the strictly financial costs of production. B) the opportunity costs of production. C) the strictly financial benefits of production. D) the opportunity benefits of production.
Suppose Lisa spends all of her money on books and bagels, and a bagel is an inferior good for her. When the price of coffee increases, the
A) consumption of coffee will fall. B) consumption of coffee will rise. C) consumption of coffee will not change. D) Not enough information.