Which Statement Best Describes the Absolute Advantage as Shown in the Graphs

question 120

Multiple Choice

Which statement best describes the absolute advantage as shown in the graphs?

• A)Pam has an absolute advantage in the production of both.
• B)Jim has an absolute advantage in the production of both.
• C)Jim has an absolute advantage in the production of pizzas,and Pam has an absolute advantage in the production of stromboli.
• D)Pam has an absolute advantage in the production of pizzas,and Jim has an absolute advantage in the production of stromboli.
• E)They both have an absolute advantage in the production of stromboli.

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Definitions:

Price Leadership

A form of oligopoly in which one dominant firm sets prices and all the smaller firms in the industry follow its pricing policy.

OPEC Cartel

An organization of oil-producing countries that coordinates and unifies petroleum policies to secure fair and stable prices for petroleum producers.

Predatory Pricing

A competitive strategy where a firm sets very low prices with the intention of driving competitors out of the market, or to prevent new entries.

Antitrust Laws

Regulations designed to promote competition and prevent monopolies by limiting the power of large corporations.