Which one of the following was the strategy followed by Japanese industrialists after World War II?
A. They sold low-priced goods to the low end of the American market while they rebuilt their industrial base.
B. They charged Japanese consumers much lower prices than they charged American consumers, since Americans could afford to pay more for these goods.
C. They sold high-priced goods to the high end of the American market, leaving the low end to Korea and Taiwan.
D. They received tens of billions of dollars in aid from the U.S. government and have still not paid back a penny.
A. They sold low-priced goods to the low end of the American market while they rebuilt their industrial base.
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Firm X belongs to Country A and Firm Y belongs to Country B. The two firms are a global duopoly. Each is considering initiating exports to a large foreign country that currently has no imports and no domestic production or consumption of this product. The figure shows the payoffs if neither, one, or both of the firms initiates exports of this product. Explain why this game has no clear solution, so both firms could decide not to export. Explain why country B's government should consider subsidizing Firm Y's exports.
What will be an ideal response?
If the rate of inflation is zero, prices are expected to remain stable, and the nominal rate of interest is 3 percent, then the
A. nominal rate is greater than the real rate of interest. B. investment demand schedule will shift upward. C. real rate of interest is less than the nominal rate. D. real rate of interest is equal to the nominal rate.
Which of the following would shift the supply curve for energy drinks to the left?
A) a decrease in the expected future price of energy drinks B) an increase in consumer income (assuming that energy drinks are normal goods) C) a decrease in the number of firms that produce energy drinks D) a decrease in the price of an input used to produce energy drinks
If an increase in autonomous consumption spending of $10 million results in a $50 million increase in equilibrium real GDP, then
A) the MPC is 0.5. B) the MPC is 0.75. C) the MPC is 0.8. D) the MPC is 0.9.