If Individuals a and B Can Both Produce Only Goods

question 93

Multiple Choice

If individuals A and B can both produce only goods X and Y, and A does not have a comparative advantage in the production of either X or Y, then we know

• A)B has an absolute advantage in the production of X and Y.
• B)A and B have the same opportunity costs for X and for Y.
• C)B has a comparative advantage in the production of both X and Y.
• D)the gains from trade will be large but only in one direction.
• E)A must have lower opportunity costs of production for both goods.

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Definitions:

Research Question

A specific query that guides a scientific study or research project.

Prejudice

The negative evaluation of a social group, and individuals within that group, based upon conceptions about that social group that are held despite facts that contradict it.

Debriefing

A process whereby a researcher explains the true purpose of a research study to a subject (respondent); usually done after completion of the study.

Experiment

An experiment is a method of research in the sciences or social sciences that involves the manipulation of variables to test a hypothesis and observe the effects.