Using only marginal revenue and marginal cost, we can determine whether a firm is incurring a profit or a loss.

List and explain the two phases and two turning points of the business cycle

What will be an ideal response?

Answer the following statement(s) true (T) or false (F)

1. If each person specializes in his area of comparative advantage and then trades for the goods he wants to have, everyone will be made better off. 2. If no one in a community desires to watch television, then it would be a waste of resources for the community to produce television sets. 3. If good wines can be produced in Turkey at costs lower than in the wine exporting countries, but the local population drinks little wine, then Turkey should not produce wine. 4. Trade will never be beneficial when both parties have a comparative advantage in producing the same good. 5. If everyone had the same abilities, then no one could benefit from trade.