What is the effect of a country's saving rate on trade deficits?
A. A high savings rate means there is more money available for investment, resulting in greater production and increased international sales which, in turn, leads to lower trade deficits.
B. A country's savings rate has no effect on the country's trade deficit.
C. A low savings rate means people are spending more than they earn, and that results in increased financial difficulties for consumers, higher interest rates, and fewer international sales, resulting in a decrease in a country's trade deficit.
D. A low savings rate means that consumers are buying more, and more buying leads to an increase in a country's trade deficit.
Answer: D
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If a monopolist wishes to increase its output and quantity sold
A. it must reduce its price, so its marginal revenue is greater than its price. B. it must raise its price, so its marginal revenue is less than its price. C. it must raise its price, so its marginal revenue is greater than its price. D. it must reduce its price, so its marginal revenue is less than its price.
Refer to the information provided in Figure 7.9 below to answer the question(s) that follow. 
Figure 7.9Refer to Figure 7.9. The slope of isocost CE is
A. -1/2. B. -1. C. -2. D. indeterminate from this information, as the prices of capital and labor are not given.
The neoclassical growth theory implies that
A) the marginal product of capital is low in poor countries. B) the rate of return on capital is low in poor countries. C) there should be large flows of capital from rich countries to poor countries. D) all of the above.
The net present value (NPV) is ________.
A) present value of the future operating profits from an investment plus the present value of the cost of the investment B) future operating profits from an investment minus the cost of the investment C) present value of the future operating profits from an investment minus the present value of the cost of the investment D) future operating profits from an investment plus the cost of the investment