The global financial crisis that began in 2008 was a great illustration of how interdependent national economies are
Indicate whether the statement is true or false
TRUE
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How does expansionary monetary policy increase spending in the economy compared to how expansionary fiscal policy increases spending in the economy?
What will be an ideal response?
Requiring a firm with international operations to follow the standards of its home country instead of those of the foreign country has all of the following advantages EXCEPT
A) it takes care of the fear of a race-to-the-bottom by making it impossible for a home-based company to exploit low standards. B) it shifts the costs of improved standards to firms and consumers in high-income countries. C) it removes the threat of domestic firms relocating abroad for low standards and ensures that any relocation that takes place is due to foreign comparative advantage. D) it avoids the problems of high-income countries dictating what standards are to be used. In this situation, firms that cross national boundaries must conform to whichever standards are higher. E) it is a comprehensive measure, since it addresses the problem of production in foreign firms as well as firms from high-standards countries that relocate abroad.
Prices serve the public interest by
A. making resource owners wealthy. B. rationing scarce resources. C. keeping poor people from purchasing more than they can afford. D. forcing the government to participate in the market.
If a consumer purchases more of good B when his income rises, good B is an inferior good
a. True b. False Indicate whether the statement is true or false