If the terms of trade between any two countries lie somewhere between their respective opportunity costs, then the effects of trade will include
A. Less interdependence between the economies of the two countries.
B. Less output for both countries.
C. Consumption outside the production possibilities curve for both countries.
D. An expansion of the production possibilities for both countries.
Answer: C
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Which of the following is a characteristic of a market where a price floor is in place?
A. The market quantity demanded exceeds the market quantity supplied. B. Fewer regulations are needed since the government sets the price. C. Fewer units are purchased than would be the case without the price floor. D. A smaller number of sellers than in markets without price floors.
The President counts among his economic advisors the Congressional Budget Office
a. True b. False Indicate whether the statement is true or false
Which of the following statements accurately contrasts individual behavior and group behavior?
a. Group behavior is more predictable than individual behavior. b. Group behavior is more dishonest than individual behavior. c. Group behavior is more varied than individual behavior. d. Group behavior is more objective than individual behavior.
Negative externalities are created when
A) an increase in the price of butterfat drives up the price of ice cream. B) a driver leaves his car in a parking space after the meter expires and receives a ticket. C) a driver drives recklessly on a busy highway. D) a driver pulls over to help a stranded motorist fix a flat tire.