Using the figure above, suppose with no trade Liz and Joe each produce at point A on their respective PPFs. Then, Joe suggests that they specialize and trade. He would produce only salads and Liz would produce only smoothies
Then, Joe says, he would buy 16 smoothies from Liz at a price of 1.5 salads per smoothie. Liz should
A) not accept Joe's offer since she would lose 2 smoothies and 2 salads.
B) accept Joe's offer, as she will be as well off as with no trade.
C) accept Joe's offer since she will gain 4 smoothies and 4 salads.
D) accept Joe's offer since she will gain 4 salads.
E) not accept Joe's offer, as the price he offers is too low for her to gain from trade.
C
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If the prices of bonds go up, the interest rates will fall and the quantity of investment demanded will rise.
a. true b. false
Antitrust laws allow the government to
a. collect revenues through the antitrust tax. b. break up companies. c. purchase privately-held companies through eminent domain. d. All of the above are correct.