"Most textiles worn by American consumers are produced in Asian and South American countries where the opportunity costs of production are lower." This observation refers to the:
a. law of supply.
b. income elasticity of demand.
c. principle of beneficial tariffs.
d. principle of comparative advantage.
e. law of decreasing returns to scale.
d
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Mary plants a number of trees in her garden every week, which keeps her neighborhood cool. Which of the following is true?
A) The marginal social cost of planting a tree is lower than the marginal private cost of planting a tree. B) The marginal private benefit of planting a tree is higher than the marginal social benefit of planting a tree. C) There is an external benefit in planting a tree. D) There is a deadweight loss in planting trees.
Consider the following two situations. (i) You purchase a $10 movie ticket in advance over the Internet, but when arriving at the theater, you realize that you lost the ticket. The only way to see the movie is to purchase a new ticket
(ii) On the way to seeing a movie, you drop a $10 bill. You still can afford the movie, but you have lost the $10. How should you, a rational person, respond to the two situations? A) You should still see the movie in both situations. B) You should respond the same way to each situation, whether it is to see the movie or not. C) In the first situation, you should skip the movie; in the second, you should still see the movie. D) In each situation, you should not see the movie.