To Determine Which of Two Producers Has a Comparative Advantage,you

question 70

Multiple Choice

To determine which of two producers has a comparative advantage,you would need to know:

• A) their increasing relative costs.
• B) the opportunity costs of production for both goods.
• C) their normative beliefs.
• D) their zero-sum games.
• E) their levels of investment.

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Definitions:

Opportunity Cost

The cost of forgoing the next best alternative when making a decision.

Production

The process of creating goods or services by combining labor, materials, and capital.

Technological Improvement

The advancement or enhancement of technology, leading to increased efficiency, productivity, or quality in processes or products.

Wage Rates

The amount of compensation an employee receives from an employer in exchange for performing a specific job, typically expressed on an hourly basis.