An advantage to exchange-rate targeting is it helps keep inflation under control by tying the inflation rate for ________ traded goods to what is found in the ________ country
A) domestically; anchor
B) domestically, domestic
C) internationally; anchor
D) internationally; domestic
C
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Imagine scale economies were not only external to firms, but were also external to individual countries
That is, the larger the worldwide industry (regardless of where firms or plants are located), the cheaper would be the per-unit cost of production. Describe what world trade would look like in this case.
In what is known as direct exporting, the exporter sells goods directly to or through an independent domestic intermediary in the exporter's home country that then exports the products to foreign markets.
a. true b. false
Since 1976 our merchandise balance of trade has been ____ and our services balance of trade has been _____.
A. positive; positive B. negative; negative C. negative; positive D. positive; negative
Which of the following real-world situations is the result of excess capacity in a monopolistically competitive market?
A. A factory producing women's clothing produces more than it can sell during a season. B. Monopolistically competitive firms do not exist in the real world. C. Gas stations with infrequently used pumps are located at all four corners of an intersection. D. A retail auto tire store orders too much inventory.