If the market price rises from P_0 to P_2 in the above figure, then there is a s
ID: 1215742 • Letter: I
Question
If the market price rises from P_0 to P_2 in the above figure, then there is a surplus equal to the distance Q_1, Q_2. surplus equal to the distance Q_0, Q_2, shortage equal to the distance Q_0, Q_2. shortage equal to the distance Q_1, Q_2. Say's law states that supply will usually be greater than demand. demand may be greater than supply. supply creates its own demand. supply and demand are never equal. A person has a comparative advantage in an activity whenever she has an absolute advantage in the activity. can do everything better than anyone else. can perform the activity at a lower opportunity cost than another person can. can do the activity in less time than anyone else. When two countries specialize m the production of different goods and trade with each other likely each country will import the goods in which it has an absolute advantage. export the goods in which it has an absolute advantage. export the goods in which it has a comparative advantage. import the goods in which it has a comparative advantage.Explanation / Answer
29. A) surplus equal to distance Q1, Q2.
30. C) supply creates its own demand.
31. C) can perform the activity at a lower opportunity cost than another person can.
32. C) export the goods in which it has a comparative advantage.