A rich nation will trade with a poor nation because the:
A. rich nation has the absolute advantage in producing all products.
B. poor nation has the absolute advantage in producing all products.
C. poor nation has the comparative advantage in producing a product.
D. rich nation has the comparative advantage in producing all products.
Answer: C
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________ was the main cause of weakening of the U.S. dollar between August 2007 and July 2008
A) Easing of monetary policy in the U.S. B) An increase in the expected value of the dollar C) Rising energy prices D) A surge in exports from China to the U.S.
When economists say that nations trade with other nations, they mean that ______.
a. the national governments establish markets for trade b. people of a nation trade with people of other nations c. all international trade passes through the government d. government-owned industries trade with each other
LRE. After a decrease in AD, there will immediately be _____
a. inflation and recession b. deflation and recession c. inflation and expansion d. deflation and expansion
The United States' balance of payments is likely to improve when
A) there is an increase in political instability in other countries. B) the inflation rate in the United States rises relative to other countries. C) the American government increases its spending on foreign aid. D) American people want to invest more in foreign countries.