Suppose that in an hour you can either make 20 tortillas or word-process 5 pages of text, while in an hour your roommate can either make 15 tortillas or word-process 15 pages of text. Which of the following is correct?
a. Your comparative advantage is in making tortillas.
b. Your roommate's comparative advantage is making tortillas.
c. Your roommate has an absolute advantage in both tasks.
d. You have an absolute advantage in both tasks.
a
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The percentage of all sales contributed by the leading four or leading eight firms in an industry is known as
A) a horizontal merger. B) a vertical merger. C) economies to scale. D) the concentration ratio.
Willie's Wading Adventures sells hip waders for fishing and duck hunting in a perfectly competitive market. If hip waders sell for $100 each and average total cost per unit is $95 at the profit-maximizing output level, then in the long run
a. more firms will enter the market. b. some firms will exit from the market. c. the equilibrium price per unit will rise. d. average total costs will fall.