Refer to the saving schedule above. As income falls from level 3 to level 2, the amount of:

Which of the following statements is true?

a. Exports tend to decrease economic efficiency. b. A nation should specialize in producing a good in which it has an absolute advantage. c. A nation should specialize in producing a good only when it has both an absolute and a comparative advantage. d. A nation should specialize in producing a good in which it has a comparative advantage. e. International trade does not reflect the benefits of specialization.

In competitive price-taker markets, if one firm raises its price,

a. others will follow b. that firm will increase its revenues c. that firm will lose revenues because other firms will not follow d. all consumers will be adversely affected e. the market demand curve will shift