One effect of a stronger dollar is
A. an increase in net exports.
B. an increase in U.S. exports and a reduction in U.S. imports.
C. an increase in both imports and exports. The effect on net exports is uncertain.
D. a reduction in U.S. exports and an increase in U.S. imports.
Answer: D
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Refer to the figure above. Which of the following statements is true?
A) Ryan has a comparative advantage in the production of Good 1, whereas Tom has a comparative advantage in the production of Good 2. B) Ryan has a comparative advantage in the production of Good 2, whereas Tom has a comparative advantage in the production of Good 1. C) Ryan has a comparative advantage in the production of both the goods. D) Tom has a comparative advantage in the production of both the goods.
Double markup problems arise when
a. upstream firms have market power b. downstream firms have no market power c. upstream and downstream products are unrelated in demand d. upstream and downstream firm's pricing decisions tend to increase the demand for the other product
Figure 33.2 illustrates Lorenz curves for four different economies. Which economy should have a Gini coefficient of zero?
A. A. B. B. C. C. D. D.
Carefully explain how monetary policy can be used to counter a recession. Explain what the central bank does as well as how its actions affect the economy. Under what circumstances is fiscal policy especially useful?