Figure 18.1Refer to Figure 18.1. After trade begins, ________ will specialize in the production of bicycles and ________ will specialize in the production of hang gliders.
A. the United States.; the United States
B. the United States; Canada
C. Canada; the United States
D. Canada; Canada
Answer: C
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Who would benefit if the exchange rate with yen (in U.S. dollars) increased?
a. c and e. b. Japanese tourists. c. U.S. consumers. d. U.S. exporters. e. Japanese exporters.
Which of the following decreases in labor demand is due to a change in product demand?
A. An increase in the price of steel increases the cost of producing cars and trucks, thus decreasing the demand for automobile workers. B. A decline in productivity in retailing decreases the demand for retail sales workers. C. The widespread availability of news on the web reduces the demand for newspaper workers. D. An increase in the price of paper increases the cost of making books, thus decreasing the demand for bookbinders.
A shift from D1 to D2 causes equilibrium price to __________ and quantity to __________.
A. rise; rise
B. fall; fall
C. rise; fall
D. fall; rise
Assume a market that has an equilibrium price of $4. If the market price is set at $8, which of the following is true?
A. Some surplus is transferred from consumers to producers, causing total surplus to increase. B. All surplus is transferred from consumers to producers, and total surplus stays the same. C. Some surplus is transferred from consumers to producers, but total surplus falls. D. Some surplus is transferred from producers to consumers, but total surplus falls.