Table 3.1 Use the Data in the Table Below to Answer the Answer

question 31

Multiple Choice

Table 3.1
Use the data in the table below to answer the following question(s) :
Output per Hour Worked

-Based on Table 3.1,trade between the United States and Mexico will occur as long as the relative price of shoes is between

• A)three computers and one computer.
• B)three computers and two computers.
• C)one-half computer and one-third computer.
• D)six computers and three computers.
• E)None of the above.

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Definitions:

Marginal Cost

The charges incurred for the production of an additional unit of a good or service.

Deadweight Loss

A loss of economic efficiency that can occur when the equilibrium for a good or a service is not achieved due to market inefficiencies.

Consumer Surplus

The difference in planned versus actual spending by consumers on a good or service.

Price Discrimination

A pricing strategy where a firm charges different prices for the same product or service to different consumers, based on their ability to pay, in order to maximize profits.