The Morel Is a Prized Mushroom That Is Often Abundant

question 25

Multiple Choice

The morel is a prized mushroom that is often abundant in the Western United States in years after forest fires. Suppose two companies are buying morels from workers willing to find them. One company offers to pay workers $5.00 per pound, and the other company will pay workers only $4.00 per pound. Economists would say that:

• A) the company willing to pay only $4.00 has a comparative advantage in selling morels.
• B) the higher-paying company will attract the more creative and innovative pickers and the lower-paying company will attract the others.
• C) the lower-paying company will attract the more creative and innovative pickers and the higher-paying company will attract the others.
• D) this situation violates the law of one price and is not likely to persist.

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Definitions:

Personal Control

The extent to which an individual believes they can control events that affect them.

Social Loafing

The event where group members apply lesser effort to reach a goal than they would if they were working solo.

Accountable

Being responsible or answerable for actions or decisions, implying a willingness to accept and report on the outcomes of one's actions or decisions.

Dispensable

Capable of being dispensed with; not essential or necessary.