Free trade means that nations can buy and sell goods from each other
a. unless absolute advantage favors one nation
b. without government interference, e.g., tariffs and quotas
c. without having to abide by comparative advantage
d. and choose their own level of tariffs against each other
e. according to their own national quotas
B
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The short-run tradeoff between inflation and unemployment implies that, in the short run,
a. a decrease in the growth rate of the quantity of money will be accompanied by an increase in the unemployment rate. b. an increase in the growth rate of the quantity of money will be accompanied by an increase in the unemployment rate. c. policymakers are able to reduce the inflation rate and, at the same time, reduce the unemployment rate. d. policymakers can influence the inflation rate, but not the unemployment rate.
Which of the following causes a shortage to become larger?
a. An increase in market price. b. An increase in supply. c. A decrease in price. d. A decrease in demand.
Whenever there are negative or positive externalities, the Coase theorem suggests that it is economically efficient for the government to intervene to resolve the externality problem.
Answer the following statement true (T) or false (F)
In the worker's leisure/consumption model, the wage is the same as the price of consumption.
Answer the following statement true (T) or false (F)