The opportunity cost of producing one additional truck is
A. the profit that could have been earned from selling that truck.
B. the amount of other goods that could not be produced because productive resources were used instead to produce that truck.
C. the price of the truck.
D. all of the choices are true.
B. the amount of other goods that could not be produced because productive resources were
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Under a gold standard,
A. with a balance of payments deficit, interest rates would fall and attract foreign capital. B. a deficit in the balance of payments increased a nation’s money supply automatically. C. all currencies were defined in terms of gold. D. when a nation had a deficit in its balance of payments, more gold was flowing in than was flowing out. E. All of the above are correct.
In the short run, there are large and persistent deviations between actual exchange rates and exchange rates predicted using purchasing power parity because of:
a. Discretionary monetary policy. b. Discretionary fiscal policy. c. Widely different inflation rates in the two nations. d. Very different real GDP growth rates in the two nations. e. Many goods and services in the two nations' price indices are not traded internationally.
If the quantity of Arizona green teas demanded falls from 4.0 million to 3.0 million as the price of Lipton green teas falls from $2.70 to $2.50, Arizona's teas and Lipton's teas are:
A. luxuries. B. inferior goods. C. substitutes. D. complements.
The figure above shows the U.S. demand and U.S. supply curves for cherries. At a world price of $2 per pound, the total imports of cherries to the United States from other nations equals
A) 200,000 pounds. B) 400,000 pounds. C) 600,000 pounds. D) 800,000 pounds. E) 0 pounds.