Diminishing Returns Show That It Is Feasible for a Country

question 46

True/False

Diminishing returns show that it is feasible for a country to specialize to the degree suggested by the simple Ricardian model.

---

Definitions:

Supply Curve

A visual chart depicting how the price of a product or service correlates with the amount a vendor is prepared and capable of providing to the marketplace.

Producer Surplus

The difference between what producers are willing to accept for a good or service versus what they actually receive, usually represented as the area above the supply curve and below the market price.

Supply Curve

A graphical representation showing the relationship between the price of a good or service and the quantity of that good or service that suppliers are willing to offer for sale, holding all other factors constant.

Demand Curve

A visual chart that shows how the quantity of a product demanded by buyers varies with its price.