Reference no: EM131138466

1. in one hour, the United States can produce 25 tons of steel or 250 automobiles. In one hour, Japan can produce 30 tons of steel or 275 automobiles. This information implies that:

a. Japan has a comperative advantage in the production of automobiles.
b. the united state has an absolute advantage in the production of steel.
c. Japan has a comperative advantage in the production of both goods
d. the united state has an absolute advantage in the production of automobiles.

2. The importance of an economic model is that it allow us to:

a.build a complex and accurate model of economy.
b. build an accurate mathematical model of economy.
c. focus on the effects of only one change at a time.
d. avoid opportunity costs.

3. The economy's factors of production are not equally suitable for producing different types of goods. This principle generates:

a. economic growth.
b. technical efficiency.
c. resource underutilization.
d. the low of increasing opportunity cost.