What is TRUE of the aggregate supply curve in the classical model?
A) The aggregate supply curve is downward sloping.
B) The aggregate supply curve is vertical.
C) The aggregate supply curve is horizontal.
D) The aggregate supply curve is not determined by the level of employment.
B
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There is a technological advance in the production of ice cream. As a result, the supply curve of ice cream shifts ________ and ________
A) leftward; both the equilibrium price and equilibrium quantity fall B) rightward; both the equilibrium price and equilibrium quantity fall C) rightward; the equilibrium price falls while the equilibrium quantity increases D) rightward; both the equilibrium price and equilibrium quantity rise
Comparative advantage is the ability, compared with another producer
A) to produce more of a product with the same resources. B) to use fewer inputs to produce the same amount of a product. C) to produce a higher-quality product with fewer resources. D) to produce an additional unit of a product at lower opportunity cost.