John Hancock

John Hancock

1.  
If people specialize in producing those goods for which they possess a comparative advantage, then the economy as a whole can produce a greater quantity of goods.

1. Fast food is faster and cheaper than a similar meal you could prepare for yourself. Which of the following does not explain that fact?
Answer
| | meal preparation has been divided into many separate tasks |
| | larger-scale production allows the introduction of more efficient machines |
| | workers gain productivity at a task over time |
| | there is less time lost moving from one task to another |
| | workers are more productive when they are being paid |
 
People have less incentive to invest the more concerned they are that their investment will not be
Answer
| | appropriated by government |
| | stolen by thieves |
| | protected from high tax rates |
| | destroyed by civil unrest |
| | blown up by terrorists |
1 points  
Question 8
 
The law of comparative advantage says that
Answer
| | the individual with the lowest opportunity cost of producing a particular good should produce it |
| | comparative advantage exists only when one person has an absolute advantage in the production of two goods |
| | whoever has a comparative advantage in producing a good also has an absolute advantage in producing that good |
| | whoever has an absolute advantage in producing a good also has a comparative advantage in producing that good |
| | gains from trade are possible only when one person has the comparative advantage in producing both goods |
1 points  
Question 9
 
Recognizing the incentive power of property rights and markets, some of the most die-hard central planners are now allowing
Answer
| | more influence from custom or religion |
| | family relations to play significant roles |
| | a role for markets |
| | communal ownership of property |
| | inefficient use of resources |
1 points  ...

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