The answers to an economy's three central economic problems are determined by the interaction of three forces: economic forces, political forces, and social forces.
Answer the following statement true (T) or false (F)
True
Economic, political, and social forces determine how an economy operates and thus answers the three economic problems.
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When a developing country relies on import substitution,
a. it sacrifices the gains from specialization and comparative advantage b. replaces low-cost foreign goods with high-cost domestic goods c. domestic producers, shielded from foreign competition, usually fail to become efficient d. other countries often retaliate with their own trade restrictions e. All of the answers are correct
When estimating a regression line, a high R2‚ tells us we have
A) a good fit. B) large residuals. C) correctly determined the direction of causation. D) all of the above E) none of the above
According to the real-balance effect, an increase in the price level will
A. decrease total planned real expenditures because of an increase in interest rates. B. decrease total planned real expenditures as a result of a decrease in the real value of money balances. C. leave total planned real expenditures unchanged since the price level of all goods has increased. D. lead to a corresponding increase in total planned real expenditures since businesses are now earning higher profits.
In 2005, the membership of the AFL-CIO changed significantly when the
A. CIO separated from the AFL. B. AFL-CIO became a union of public-sector employees only. C. AFL-CIO was able to organize its first factories in mainland China. D. Teamsters and other unions withdrew from the umbrella organization.