When Mexico's exchange rate depreciated dramatically in 1994,
a. American exports to Mexico increased
b. American exports to Mexico declined
c. Mexican tourism to the U.S. increased
d. American tourism to Mexico decreased
e. Mexicans received more dollars for their peso
B
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In 2010, the debt-to-GDP ratio increased to roughly the same ratio as the 1990s
a. True b. False Indicate whether the statement is true or false
Suppose two countries are identical in every way with the following exception. Economy A has a higher saving rate than economy B. Given this information, we know with certainty that
A) steady state consumption in A is higher than in B. B) steady state consumption in A is lower than in B. C) steady state consumption in A and in B are equal. D) steady state growth of output per worker is higher in A than in B. E) none of the above
With average cost pricing, the monopolist
A) earns no accounting profit. B) produces where P = MC. C) earns a normal rate of return for its shareholders. D) does not cover opportunity costs.
Which of the following is correct about comparative advantage?
A) Some countries will have a comparative advantage in everything. B) A country has a comparative advantage in the production of a good if it can produce the good at lower opportunity cost than any other country. C) Having a comparative advantage without an absolute advantage is impossible. D) A comparative advantage in a good means that the country can produce more of the good than any other country. E) None of the above answers is correct.