Author Question: The law of comparative advantage says that a. the individual with the lowest opportunity cost of ... (Read 108 times)

crazycityslicker · **on:** Jul 1, 2018

The law of comparative advantage says that
a. the individual with the lowest opportunity cost of producing a particular good should produce it
b. comparative advantage exists only when one person has an absolute advantage in the production of two goods
c. whoever has a comparative advantage in producing a good also has an absolute advantage in producing that good
d. whoever has an absolute advantage in producing a good also has a comparative advantage in producing that good
e. gains from trade are possible only when one person has the comparative advantage in producing both goods

Question 2

The law of comparative advantage says that a person should produce a good if she
a. has the greatest desire to consume that good
b. has the lowest opportunity cost of producing that good
c. has an absolute advantage in a related activity
d. has a comparative advantage in a related activity
e. is equally good at producing this good as someone else is