As a general rule, free trade:
A. acts to equalize the supply of and demand for factors of production across countries.
B. increases the supply of factors that are domestically scarce.
C. causes factor prices to converge across countries.
D. All of these are true.
Answer: D
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What will be an ideal response?
When all the factors of aggregate expenditure are influenced by income, the multiplier becomes a function of the: a. marginal propensity of government purchases
b. marginal propensity to consume out of disposable income. c. marginal propensity of aggregate expenditure. d. marginal propensity to import.
Slower real wage growth in the U.S. since the 1970s accompanied by rapid job growth, can be explained by:
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A. capital-intensive B. labor-intensive C. labor-saving D. capital-dependent