Suppose that opportunity costs are constant in both France and Italy. In France, maximum feasible hourly production levels are either 3 units of wheat or 5 units of wine. In Italy, maximum feasible hourly production levels are either 4 units of wheat or 10 units of wine. It is correct to state that
A. Italy has an comparative advantage in producing both wheat and wine.
B. France has a comparative advantage in producing both wheat and wine.
C. France has a comparative advantage in producing wine.
D. Italy has a comparative advantage in producing wine.
Answer: D
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A. Product W B. Product X C. Product Y D. Product Z
During the 1980s, Harley-Davidson, the American motorcycle maker asked Congress for tariff protection from large motorcycles imported from Japan
Harley-Davidson argued that their company needed protection so the company could reorganize and, after some time had passed, could become more competitive. Harley-Davidson's argument is similar to the ________ argument for protection. A) anti-dumping B) save domestic jobs C) infant-industry D) national security E) bring diversity and stability
Throughout the post-World War II era, the importance of tariffs as a trade barrier has
A) increased. B) decreased. C) remained the same. D) fluctuated wildly. E) demonstrated a classic random walk with a mean-reversion tendency.
When the federal funds rate equals the interest rate paid on excess reserves
A) the supply curve of reserves is vertical. B) the supply curve of reserves is horizontal. C) the demand curve for reserves is vertical. D) the demand curve for reserves is horizontal.