Suppose Hank and Tony Can Both Produce Corn

question 179

True/False

Suppose Hank and Tony can both produce corn. If Hank's opportunity cost of producing a bushel of corn is 2 bushels of soybeans and Tony's opportunity cost of producing a bushel of corn is 3 bushels of soybeans, then Hank has the comparative advantage in the production of corn.

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Definitions:

Green Ink Pads

Small, flat surfaces soaked with green ink used for stamping or printing purposes.

Marginal Revenue

The supplementary earnings received from the sale of one extra unit of a good or service.

Monopoly Power

Monopoly power refers to the ability of a company or entity to control the supply of a good or service, and to significantly influence the terms and price under which it is sold.

Marginal Cost

The extra financial burden of producing another unit of a good or service.