Suppose that labor is mobile between sectors but that capital and land are specific. Then labor will tend to benefit from trade when:
a. it spends a large amount of its income on the imported good.
b. it spends a large amount of its income on the exported good.
c. wages do not change much in percentage terms.
d. all of these occur.
Answer: a. it spends a large amount of its income on the imported good.
You might also like to view...
In the figure above, Nike maximizes its profit if it charges ________ per pair of shoes
A) $75 B) $60 C) $72 D) $42
The concept of minimizing the number of physical units of the inputs needed for a given amount of output is known as
a. technical efficiency. b. the principle of diminishing marginal returns. c. economic efficiency. d. decreasing returns to scale.
A tavern is likely to have a ______________________ price elasticity of supply than does an antiques dealer due to ______________________.
A. more elastic; availability of inputs B. less elastic; availability of inputs C. less elastic; a longer adjustment time D. less elastic; a shorter adjustment time
Which of the following involves financial intermediation?
a. a bank makes a loan b. a household buys stock issued by a corporation c. a foreign government purchases U.S. government bonds d. All of the above are correct.