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Generally, specialization leads to

Generally, specialization leads to

A) constant opportunity costs.

B) greater productivity.

C) the production of fewer capital goods.

D) greater self-reliance.

9) Specialization and the division of labor typically result in

A) cost overruns.

B) increased output.

C) decreased output.

D) a greater reliance upon imports.

10) Absolute advantage is

A) producing at a lower opportunity cost.

B) producing a good using the fewest inputs.

C) producing a good only when demand is high.

D) producing a good that requires imported components.

11) A person has a comparative advantage in an activity whenever she

A) has an absolute advantage in the activity.

B) can perform the activity at a lower opportunity cost than another person can.

C) can do the activity in less time than anyone else.

D) can do everything better than anyone else.

12) Comparative advantage is always a(n) ________ concept.

A) absolute

B) efficiency

C) relative

D) monetary

13) Other things being equal, you can make $20,000 a year teaching, $25,000 a year typing, $30,000 a year driving a cab, and $40,000 a year as a chef. You have a comparative advantage in

A) teaching.

B) driving a cab.

C) being a chef.

D) one of them but we need more information to know which.

14) Comparative advantage implies choosing the activity that

A) has a high opportunity cost.

B) is inside the production possibilities frontier.

C) has the lowest opportunity cost.

D) does not demand any specialization.

15) If individual X has comparative advantage in painting and individual Y has comparative advantage in carpentry, then

A) individual X must use fewer hours to paint a fence than individual Y.

B) individual Y will specialize in painting.

C) there is a lower opportunity cost (expressed in units of carpentry) for individual X to paint than for individual Y to paint.

D) specialization will not occur, since each does not have a clear absolute advantage.

16) The ability to produce a good at a lower opportunity cost that others is known as

A) comparative advantage.

B) absolute advantage.

C) specialization.

D) marginal cost production.

17) The division of labor refers to

A) workers being assigned specific tasks.

B) workers performing multiple tasks.

C) separating men and women in the workforce.

D) creating jobs that all people can perform at the same level.

Dec 10 2019 View more View Less

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