Opportunity cost theory suggests that a nation has
A) A comparative advantage in the good with the lower opportunity cost.
B) An absolute advantage in the production of the good with the lowest opportunity cost.
C) No advantage in the production of any good with an opportunity cost.
D) None of the above.
Answer: A
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What would happen to the demand curve for Coke if Pepsi went on sale at the grocery store?
A. Shift to the right. B. Shift to the left. C. Stay the same. D. Unsure, there's not enough information.
All of the following shift the demand for money curve EXCEPT
A) a rise in the nominal interest rate. B) an increase in the price level. C) a decrease in real GDP. D) an improvement in financial technology. E) an increase in real GDP.
What is the more efficient choice: sending one's child to John Q. Public High School at zero dollar tuition or to Purebred Prep School at several thousand dollars a year?
A) High school, because it's much cheaper. B) Prep school, because it's much higher in quality of instruction. C) Prep school, because what matters most is not what you know, but who you know. D) It depends on the decision makers' own evaluations of cost and benefit.
If capital inflows decrease due to higher interest rates in other countries and large amounts of import spending, there will be:
A) upward pressure on a country's exchange rate. B) downward pressure on a country's exchange rate. C) no pressure on a country's exchange rate. D) none of the above.