A nation's comparative advantage
a. can almost always be traced to its natural resources
b. is often based on its natural resources
c. is often based on barriers to international trade
d. is reflected in the shape of its demand curve for imported goods
e. is a result of increasing marginal returns
B
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The value of marginal product of labor is the increase in
A) revenue created by producing one more unit of output. B) revenue created by hiring one more unit of labor. C) total product necessary to make revenue increase by one dollar. D) total product generated by hiring one more unit of labor.
Suppose capital and labor are perfect substitutes resulting in a production function of q = K + L. That is, the isoquants are straight lines with a slope of -1
Derive the long-run total cost function TC = C(q) when the wage rate is w and the rental rate on capital is r.