If the U.S. can produce pizza for $5 each and barrels of beer for $25 each, and Germany can produce pizza for $7 each and barrels of beer for $21 each, then
A) each country will produce both pizza and beer.
B) the U.S. will produce beer and trade with Germany for pizza.
C) the U.S. will produce pizza and trade with Germany for beer.
D) All of the above.
C
You might also like to view...
Suppose the government raises the minimum wage in the economy. All else constant, how will this affect the quantity of labor demanded and the quantity of labor supplied?
What will be an ideal response?
Rent seeking is
A) when consumers search for the lowest possible rent on housing. B) illegal in the U.S. C) what regulators do to improve their chances of getting jobs in the regulated industry after they leave government service. D) where firms expend effort and money to profit from government actions.
The monopoly that does not practice price discrimination
a. is a firm with a marginal revenue curve with a slope of zero b. is a price taker c. charges the same price for every unit of output it sells d. operates in a market where all firms charge the same price e. is always profitable in the short run
Suppose that a $30 billion increase in government spending increases Real GDP by $150 billion, and that a $10 billion tax reduction increases Real GDP by $40 billion. In this situation, the tax multiplier is _______________ the government spending multiplier
A) less than B) greater than C) equal to D) none of the above