Individuals a and B Can Both Produce Good X

question 25

Multiple Choice

Individuals A and B can both produce good X.We say that A has a comparative advantage in the production of good X if

• A)A has a lower opportunity cost of producing X than B.
• B)A has a higher opportunity cost of producing X than B.
• C)A can produce more units of X in a given time period than B.
• D)A can produce X using newer technology than B.
• E)A can produce less units of X in a given time period than B.

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Definitions:

Base Year

A specific year against which economic growth is measured, serving as a standard of comparison for other years.

National Income

National Income is the total income earned by the residents of a country, including wages, profits, rents, and taxes, minus subsidies, over a certain period of time, often used to assess the economic health of a country.

Wages

Compensation provided to workers for their efforts or tasks, usually determined based on hours worked, daily rates, or the amount of work completed.

Salaries

Fixed regular payments, typically paid on a monthly or biweekly basis but often expressed as an annual sum, made by an employer to an employee, especially a professional or white-collar worker.