Question

Question 32 (Mandatory) (3 points) If the U.S. exports wheat to Mexico, then the opportunity cost of wheat in the U.S. must be greater than the opportunity cost of wheat in Mexico. True False Question 33 (Mandatory) (3 points) A market characterized by many sellers, differentiated products, and easy entry is perfect competition. True False Question 34 (Mandatory) (5 points) "If a tax cut is good for me, it must be good for the whole economy." This statement is an example of the fallacy called A) the fallacy of composition. B) the scientific method. C) ceteris paribus Activate Go to Sett D) the posh hoc fallacy

Answer 1

32. A country exports only the good in which it has comparative advantage. A country has comparative advantage in the production of a good in which it has less opportunity cost Compared to it's opponent country.

If US exports wheat to Mexico, it means US has comparative advantage in the production of wheat. Therefore, opportunity cost of wheat in the US is less than the opportunity cost of wheat production in Mexico.

Answer: False

33. A market characterized by many sellers, differentiated products, and easy entry is monopolistic competition. A market characterized by many sellers, homogeneous products, and easy entry is perfect competition.

Answer: False