In general, the percentage of appreciation of one nation's currency is equal to:
a. its rate of growth of real GDP.
b. its purchasing power.
c. its population growth.
d. the percentage of depreciation of the foreign nation's currency.
Answer: d. the percentage of depreciation of the foreign nation's currency.
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As we move along a production possibilities curve and acquire larger and larger amounts of one good (e.g., guns), the sacrifices of the alternative good (e.g., butter) become larger and larger. This is an illustration of
A. the law of demand. B. the law of supply. C. decreasing opportunity costs. D. increasing opportunity costs.
To increase workers' incomes, the City of New York's government set a wage below which it is illegal for employers to pay employees. This wage is referred to as the
A) union wage. B) government wage. C) efficiency wage. D) minimum wage. E) city wage.
The product life cycle model says that comparative advantage in manufactured goods may move from one country to another as a product becomes more standardized
Indicate whether the statement is true or false
Refer to Figure 14.2. The income effect of the wage decrease on the amount of hours of leisure is:
A) L0 to L1. B) L0 to L2. C) L1 to L2. D) L2 to L1. E) none of the above