Research by economists Bloom, Draca, and Van Reenen revealed that imports from China were associated with not only lower consumer goods prices, but also a ______________ cost of inputs for domestic firms, a(n) ______________ in the variety of products those domestic firms sold, and a(n) _______________ in U.S. productivity
A) lower; increase; increase
B) higher; decrease; increase
C) lower; increase; decrease
D) higher; increase; decrease
E) ?lower; decrease; decrease
A
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One reason that supports nations having separate currency suggests that there are welfare gains from
A) currency competition. B) seignorage. C) capital mobility. D) debt reduction.
If the money multiplier is 10, the sale of $1 billion of securities by the Fed on the open market causes a
A) $10 billion decrease in the money supply. B) $1 billion decrease in the money supply. C) $1 billion increase in the money supply. D) $10 billion increase in the money supply.
Job is a smoker. He has a utility function for cigarettes smoked in bars (q1 ) and a composite good (q2 ) given by U(q1,q2 ) = 10q1.5 + q2 Job's income is $100 and faces prices p1 = 5 and p2 = 1. The government is planning to ban smoking in bars
Compute the compensating variation.
If the current Real GDP is less than Natural Real GDP, then the economy is
A) in long-run equilibrium. B) in a recessionary gap. C) in an inflationary gap. D) possibly in short-run equilibrium. E) b and d