When One Producer Has a Comparative Advantage in Production,she

question 29

Multiple Choice

When one producer has a comparative advantage in production,she:

• A) can produce more output than someone else using the same quantity of resources.
• B) can produce a good at a lower opportunity cost than someone else.
• C) does not benefit from trade with other producers.
• D) is unable to reach her production possibilities frontier (PPF).
• E) trades only with others who have the same comparative advantage.

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Definitions:

Income Return

A measure of the income generated by an investment, usually expressed as a percentage of the investment's cost.

Capital Structure Weight

The proportion of debt and equity that composes a company's financing of its operations and growth, often affecting its risk and return.

Tax Rate

The extent to which the government extracts a percentage of income as taxes from businesses or people.

Market Value

The current exchange rate for acquiring or disposing of a service or asset.