Workers work for after-tax wages, thus an income tax represents a reduction in the effective wage rate
a. True b. False
a
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If Happy Avocados, a ready-made guacamole manufacturer, contracts with an outside supplier to produce avocados, this is an example of ________.
A) outsourcing B) forward integration C) divestiture D) backward integration
When a payment is indexed to inflation and the price index understates inflation,
a. the real payment decreases over time b. the real payment increases over time c. the nominal payment decreases over time d. in unemployment rate will increase e. the level of unemployment will increase
A _________________ in an Edgeworth Exchange box identifies all the efficient ways of dividing the two goods between the consumers.
Fill in the blank(s) with the appropriate word(s).
Which of the following refers to trade creation?
A. The net change in the volume of trade among member countries when they form a trade bloc B. The net increase in imports when foreign firms lower the prices of their exports C. The net increase in exports when the currency of a country depreciates with respect to a foreign currency D. The net volume of new trade that results from the formation of a trade bloc