If the index of intra-industry trade for an industry is zero, then:
a. exports and imports in that industry are equal.
b. there are no exports in that industry.
c. there are no imports in that industry.
d. there is no trade in that industry.
Ans: d. there is no trade in that industry.
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According to classical growth theory, people earn only a subsistence real income because of growth in
A) technology. B) employment. C) population. D) labor productivity. E) capital.
If the nominal rental price of capital divided by the price of output is less than the marginal product of capital, a firm that wishes to maximize profits will
A) purchase more capital goods. B) purchase fewer capital goods. C) maintain the current level of capital goods. D) allow capital goods to wear out without purchasing additional capital goods.
The basic principle that explains the demand for a factor of production is the
a. principle of marginal productivity. b. Hotelling principle. c. principle of opportunity cost. d. Ramsey pricing principle.
Apple Computer developed Apple's new iTunes Music Store, which offers more than 200,000 songs from five major record labels, for use with Apple's iPod and iMac. More than a million songs were downloaded the first week alone! In economic terms, CEO Tim Cook helped convert capital and labor inputs into products consumers use. Any activity that results in the conversion of resources into products that can be used in consumption is
A. production. B. demand. C. a start up venture. D. not profitable.