Which of the Following Statements Is True

question 45

Multiple Choice

Which of the following statements is true?

• A) An economic agent can have a comparative advantage in the production of all goods.
• B) The agent with the higher opportunity cost of producing a good has the comparative advantage in producing that good.
• C) There are mutually beneficial gains from trade if opportunity costs differ.
• D) An economic agent who has the absolute advantage in producing a good also has the comparative advantage in producing that good.

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Definitions:

Compounded Semi-annually

The process of calculating interest on both the initial principal and the accumulated interest from previous periods twice a year.

EAR

Effective Annual Rate is the actual return on an investment or the actual interest rate of a loan, taking into account the effect of compounding interest over the period.

Calculate

To calculate means to determine the amount or number of something by using mathematical processes.

Birth Rate

The number of live births per thousand of population per year.