Which of the following set of events is most likely to result in moderating the phases of a business cycle?
a. a war coupled with a major improvement in communications technology
b. higher interest rates coupled with a decrease in the demand for housing
c. the invention of the silicon chip coupled with the invention of a new energy source
d. decrease in capital stock coupled with the invention of high-definition television
e. a war coupled with higher interest rates
E
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The argument that import restrictions save jobs and promote prosperity fails to recognize that
a. there are no secondary effects of import restrictions. b. import restrictions will lower prices in the protected industries. c. import restrictions cannot create jobs in any industries. d. U.S. imports provide people in other countries with the purchasing power required for the purchase of U.S. exports.
Which of the following best explains why increasing marginal costs of production arise?
A. Different commodities use inputs in different proportions. B. All the factor inputs are not fully utilized in the production of different commodities. C. Different consumers have different tastes and preference sets. D. The factor endowments vary across countries.
Units of CapitalNumber of WorkersOutput/Day50051405290531505420055235
Refer to Table 2.3. What can be observed about the given resources?
A. Capital and labor are both fixed. B. Capital is variable. C. Capital is fixed. D. Labor is fixed.
Suppose an American worker can make 50 pairs of gloves or grow 300 radishes per day. On the other hand, a Bangladeshi worker can produce 100 pairs of gloves or grow 200 radishes per day. Using the concept of absolute advantage, which of the following statements is true? The United States:
A. has the absolute advantage in the production of gloves, but not radishes. B. does not have the absolute advantage in the production of either gloves or radishes. C. has the absolute advantage in the production of radishes, but not gloves. D. has the absolute advantage in the production of both gloves and radishes.