An Existing Comparative Advantage Can Be Further Magnified by Specialization

question 28

Multiple Choice

An existing comparative advantage can be further magnified by specialization because:

• A) it eliminates the need to switch from one task to another.
• B) repetition results in boredom.
• C) a variety of tasks will rise.
• D) small tasks will be merged into larger tasks.

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Definitions:

Elasticity of Supply

A measure of how much the quantity supplied of a good changes in response to a change in price.

Cross-price Elasticity

A measure of how the demand for one good changes in response to changes in the price of another good.

Substitutes

Alternate products or services that can satisfy the same consumer need, allowing consumers to switch between them based on preference, price, or availability.

Cross-price Elasticity

A measure of how the demand for one good responds to a change in the price of another good, indicating substitutes or complements.