The basis for free trade is the concept of
A) absolute advantage.
B) differences in natural resources and climate.
C) differences in nominal wages.
D) comparative advantage.
D
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John wants to buy a new lawn mower. He can either buy it in the US and pay $500 or buy it in Mexico and pay 8188 Mexican Pesos. At the exchange rate of 1 Mexican Peso=0.771US$, ignoring any other costs, he would
a. Prefer buying in the US b. Prefer buying in Mexico c. Be indifferent about where he buys his television d. None of the above
For about the last 45 years, federal taxes have remained relatively constant as a percentage of GDP
a. True b. False Indicate whether the statement is true or false
One reason that college graduates earn higher wages than non-graduates is because college graduates:
A. acquire additional skills to allow them to work in more industries than non-graduates. B. always work in more dangerous jobs than non-graduates. C. are always more intelligent than non-graduates. D. are less equipped to deal with technological change, as their skills are technology-specific.
The neoclassical theory of investment was pioneered by
A) Dale Jorgenson. B) James Tobin. C) John Maynard Keynes. D) Paul Samuelson.