The Law of Comparative Advantage Indicates That

question 222

Multiple Choice

The law of comparative advantage indicates that

• A) a group of people will reduce their output when each good or service is supplied by the low opportunity cost producer.
• B) trading partners lose when they can acquire a good through trade cheaper than they can produce it.
• C) trade is most effective when people trade only among those in their own nation.
• D) a group of people can increase their output when each good or service is supplied by the low opportunity cost producer.

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Definitions:

Necessary and Proper Clause

A provision in the U.S. Constitution granting Congress the power to pass all laws deemed necessary and proper for carrying out its duties.

Congress Powers

The legislative powers granted to the U.S. Congress by the Constitution, including taxing, spending, and regulating interstate commerce.

Rational Basis Test

A standard of judicial review that requires a law to be rationally related to a legitimate government interest.

Means-Ends Test

A method of ethics that evaluates actions by examining the goals they seek to achieve and the means used to achieve those goals.