If after a country experiences capital flight, people become more confident about the safety of its assets, then in that country
a. the real exchange rate and the real interest rate will rise.
b. the real exchange rate will rise and the real interest rate will fall.
c. the real exchange rate will fall and the real interest rate will rise.
d. the real exchange rate and the real interest rate will fall.
b
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How is leisure treated in the calculation of GDP of an economy? Does such a calculation imply that GDP is good measure of well-being? Why or why not?
What will be an ideal response?
When dealing with negative externalities, government action is required
A) only if transactions cost are low. B) for any bargain to be successful. C) only in environmental disputes. D) only if transactions costs preclude bargaining between polluter and victim.
Assume a two-commodity, two-country world. Then assume that the U.S. has a comparative advantage in the production of computers and Mexico has a comparative advantage in the production of oil. Which of the following statements is true?
A. U.S. consumption of oil will decrease after the introduction of trade. B. U.S. consumption of oil will increase after the introduction of trade. C. Mexico's consumption of oil will decrease after the introduction of trade. D. All of the statements are true.
Rent controls and controls on other prices often aggravate the very problem they are intended to solve.
Answer the following statement true (T) or false (F)