What does it mean to have an absolute advantage in the production of two goods?
What will be an ideal response?
Having an absolute advantage in the production of two goods means that, when producing solely good A or solely good B, you can produce more than your competitor.
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In the Keynesian model, whenever planned investment is less than planned saving
A) the amount of planned investment will decrease, and real GDP will decrease. B) there will be an unplanned inventory increase, and real GDP will eventually decrease. C) there will be an unplanned inventory decrease, and real GDP will eventually increase. D) the amount of planned investment will decrease, and real GDP will remain unchanged.
According to the process of creative destruction, at first the entrepreneur will be able to sell her product for
a. a low price because it is not well known. b. a high price because there is no competition. c. a fair price because these are contestable markets. d. at a price of zero until the market is created.