Intra-industry trade is most common in the trade patterns of
A) the industrial countries of Western Europe.
B) the developing countries of Asia and Africa.
C) raw material producers.
D) China with the rest of the world.
E) labor-intensive products.
A
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Consider the market for peanut butter. If there is a decrease in the price of deli turkey slices (a substitute in consumption for peanut butter) along with a decrease in the price of peanut brittle (a substitute in production for peanut butter), the
A) equilibrium price of peanut butter definitely rises. B) equilibrium quantity of peanut butter definitely increases. C) equilibrium price of peanut butter might rise or fall. D) equilibrium price of peanut butter definitely falls. E) equilibrium quantity of peanut definitely decreases.
When the Federal Reserve sells $100 worth of government securities, bank reserves
A) rise by $100. B) rise by $100 times the deposit expansion multiplier. C) fall by $100. D) fall by $100 times the deposit expansion multiplier.
Between 1890 and 1914, the gold stock of the world _______________ and world prices (in general)
A) doubled; increased. B) tripled; increased. C) rose by 50%; increased. D) doubled; decreased. E) tripled; decreased.
The economy’s IS curve has a downward slope because
a) when output is too high, firms cut investment to reduce inventory b) as income rises, consumption rises and saving falls c) as interest rates rise, investment decreases d) as uncertainty increases, saving rises and consumption falls e) as government purchases rise, interest rates fall