econ Flashcards
(6 cards)
According to Mercantilists, what was the basis of a country’s power?
a) Its military strength
b) Its wealth in gold and silver
c) Its population size
d) Its technological advancements
B
According to Mercantilists, who were the winners and losers in trade?
a) Exporters win, importers lose
b) Importers win, exporters lose
c) Both exporters and importers win
d) Neither exporters nor importers win
A
What did Mercantilists advocate for in terms of government policy?
a) Encourage and subsidize exports
b) Limit exports to maintain domestic resources
c) Discourage trade altogether
d) Focus on increasing imports
A
If country X has higher labor productivity in the production of umbrellas than the rest of the
world, we would say that country X has a(n) _____ in the production of umbrellas.
a. comparative advantage
b. absolute advantage
c. absolute disadvantage
d. comparative disadvantage
B
According to the theory of absolute advantage, when does a country have an absolute advantage in producing a product?
a) When it can produce a product at a lower cost than any other country
b) When it can produce a product faster than any other country
c) When it can produce a product with higher quality than any other country
d) When it can produce a product with the most advanced technology
B
