The total value added of the economy equals:
(a) Total profits;
(b) Total wages;
(c) Total value of all final transactions in the economy;
(d) None of the above
Answer: (d) None of the above
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The speculative attack on the German mark in 1971 resulted in
A) a large increase in the German monetary base. B) a decline in the value of the mark relative to the dollar. C) a decision to end the floating of the mark against the dollar. D) a large decrease in the German monetary base.
Refer to Figure 4.4. At an interest rate of 7%,
A) Foreign borrowers have an incentive to offer lenders in the United States an interest rate greater than 7%. B) Foreign lenders have an incentive to offer borrowers in the United States an interest rate less than 7%. C) U.S. lenders have an incentive to offer borrowers in the rest of the world an interest rate of 7%. D) U.S. borrowers have an incentive to offer U.S. lenders an interest rate greater than 7%.
Eddys' Electronics found that instead of producing a dvd player and a gaming system separately, it is cheaper to incorporate dvd playing capabilities in their new version of the gaming system. Eddy's is taking advantage of
a. Economies of Scale b. Learning curve c. Economies of Scope d. Decreasing marginal costs
If the slopes of the production possibility frontiers involving sugar and rice in countries A and B are equal
A. each country will produce identical quantities of sugar and rice. B. specialization does not benefit either country. C. the opportunity cost of producing rice is less in Country B. D. the opportunity cost of producing sugar is less in Country A.