Specialization and trade
A) does not benefit anyone.
B) allows nations to produce inside their individual production possibilities frontier.
C) allows nations to consume combinations of products that are outside their individual production possibilities frontier.
D) shifts the production possibilities frontier inward.
E) shifts the production possibilities frontier outward.
C
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Each member of a cartel
A) agrees to reduce output lower than it would if it were acting independently. B) is operating illegally in every country in which it is doing business. C) sets output independently of the impact on other members. D) makes less money than it otherwise would.
When the federal government installs a price support program that requires the government to purchase all of a good not bought in the private economy at the support price, changes in producer surplus
A) are negative. B) are positive, but more than offset by the cost to consumers and the government. C) are positive, and not offset by the cost to consumers and the government. D) and consumer surplus are both positive.