Despite Specialization and Comparative Advantage,household Production Still Exists Because for Some

question 73

Multiple Choice

Despite specialization and comparative advantage,household production still exists because for some households:

• A)the opportunity cost of production at home is greater than the cost of purchasing the good in the market.
• B)production at home is less costly than purchasing the good in the market.
• C)the value of home production exceeds the sunk cost of home production.
• D)the value of home production is ignored.
• E)the expenditure on food and clothing represents a small portion of their total budget.

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Definitions:

Market Supply Curve

A graphical representation of the quantity of goods and services that suppliers are willing and able to sell at various prices during a given period.

Complements

Goods or services that are used together, where the demand for one is increased when the price of the other decreases.

Baby Boom

A significant increase in the birth rate, particularly the post-World War II population surge between 1946 and 1964.

Quantity Demanded

The total amount of a good or service that consumers are willing and able to purchase at a specific price.