Ginger and Maryann Are Lost in the Jungle, Where the Only

question 47

Multiple Choice

Ginger and Maryann are lost in the jungle, where the only things to eat are mangoes and fish. Ginger can gather more mangoes per hour than Maryann and can also catch more fish per hour than can Maryann. Therefore:

• A)there are no gains to specialization and trade for Ginger.
• B)there are no gains to specialization and trade for Maryann.
• C)Maryann should specialize in the activity for which she has a comparative advantage.
• D)Ginger should specialize in the activity for which she has an absolute advantage.

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Definitions:

Demand-Side Economics

An economic theory focused on increasing demand for goods and services as a pathway to economic growth and full employment.

Fiscal Policy

The use of government spending and taxation to stabilize the economy.

Economic Indicators

Statistical metrics that help assess the overall health and direction of an economy, guiding investment and policy decisions.

Consumer Price Index

A measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food, and medical care, used to estimate inflation.