1. To produce 100 bushels of wheat, Farmer A requires fewer inputs than does Farmer B. We can conclude that Farmer A has an absolute advantage over Farmer B in producing wheat.
2. If one producer is able to produce a good at a lower opportunity cost than some other producer, then the producer with the lower opportunity cost is said to have an absolute advantage in the production of that good.
3. An increase in the price of blue pens will increase both the equilibrium price and quantity in the market for black pens.
4. A decrease in the price of blueberries will decrease both the equilibrium price and quantity in the market for blueberry muffins.
5. If a t-shirt manufacturer supplies 1,000 t-shirts per week when the price of t-shirts is $10 and supplies 1,200 t-shirts per week when the price of t-shirts is $12, the price elasticity of supply is 2.
6. If we observe that when the price of chocolate decreases by 10%, quantity demanded increases by 25%, then the demand for chocolate is price elastic.
7. If a tax is imposed on the buyers of a product, then the tax burden will fall entirely on the buyers.