Jayden can produce 10 pens or 20 pencils in one hour while Alexander can produce 15 pens or 5 pencils in one hour. Which of the following statements is correct?
a. Alexander has a comparative advantage over Jayden in the production of pencils
b. Alexander has a comparative advantage over Jayden in the production of pens
c. Jayden has a comparative advantage over Alexander in the production of pens
d. Alexander and Jayden cannot gain from specialization and exchange.
B
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Suppose that the economy is at long-run equilibrium. If there is a sharp decline in the stock market combined with a significant increase in immigration of skilled workers, then in the short run
a) the price level will fall, and real GDP will fall. b) real GDP will fall and the price level might rise, fall, or stay the same. c) real GDP will rise and the price level might rise, fall, or stay the same. d) the price level will fall, and real GDP might rise, fall, or stay the same. e) the price level will rise, and real GDP might rise, fall, or stay the same.
Growth accounting, popularized by Robert Solow, attempts to attribute a change in aggregate output
A) to its most important single cause. B) separately between changes in government policy and changes in total factor productivity. C) separately between changes in total factor productivity and changes in the supplies of factors of production. D) separately between changes in the supplies of factors of production and changes in government policy.