In economics, what does CPI stand for?
A) Continuous Price Inflation.
B) Central Price Information.
C) Consumer Price Index.
D) Collateral Price Inflation.
Question 2
Suppose that Canada can produce 15 timber or 3 film and Mexico can produce 9 timber or 3 film. Suppose that opportunity costs are constant. Which of the following is FALSE?
A) Canada has an absolute advantage in timber production.
B) Mexico has a comparative advantage in film production.
C) The opportunity costs for producing timber are lower in Canada than in Mexico.
D) Canada and Mexico would find trade mutually advantageous at a ratio of one unit of film to six units of timber.
