Question

- Tom Brady should mow his own lawn because he is very athletic and has very low opportunity cost of his time. (True/False)

- The concept of comparative advantage is based on who uses fewer inputs to produce a good or service. (True/False)

- A change in consumers' tastes lead to a movement along the demand curve. (True/False)

- There is no difference between a movement along the demand curve and a shift in the demand curve. (True/False)

- Law of supply says, other things being equal, when the price of a good rises, the quantity supplied of the good falls, and when the price falls, the quantity supplied falls as well. (True/False)

Answer 1

a) False, him mowing his own lawn involve a huge a opportunity cost so he should hire some worker for the job and concentrate more on his career.

b) True, the fewer the goods used by the consumer in the market to produce the goods the higher comparative advantage they have,

c) Fasle, it will shift the demand curve on its own and will not cause a movement along the demand curve.

d) False, there is a huge difference between the two, one is caused by price and other is by other factors that are not related to price.

e) False, When the price falls the quantity supply falls but when the price rises the quantity supplied will rise.