The Principle of Comparative Advantage States That Specialization Increases Productivity

question 93

Multiple Choice

The principle of comparative advantage states that specialization increases productivity, but the principle of increasing opportunity costs states that, when you increase production of a single good, you must use increasingly costly resources. These two principles:

• A) are evidence that economic theory is internally inconsistent.
• B) are an example of the difference between abstract models and the real world.
• C) cannot be true at the same time.
• D) together account for the outward bow shape of production possibility curves.

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Definitions:

Spiracles

Openings on the surface of some animals, such as insects, spiders, and some fish, which lead to respiratory systems, allowing air to enter the body.

Annelids

A phylum of invertebrate animals characterized by their segmented bodies and include earthworms, leeches, and marine worms.

Diving Marine Mammals

Marine animals, such as whales, seals, and dolphins, adapted to diving deep under water to feed, communicate, or avoid predators.

Adaptations

The method through which a species adapts to its surroundings; this occurs as natural selection works on variation that can be passed down through generations.