The big increase in the U.S. trade deficit in the mid-1970s was mainly due to ___________.
Fill in the blank(s) with the appropriate word(s).
much higher oil prices
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Which of the following is NOT a benefit of money when used as a medium of exchange?
A) allowing individuals to specialize B) allowing individuals to pay off debts C) allowing for some economic efficiencies D) providing economic growth
With rational expectations, a policy that would decrease AD would lead to:
a. lower inflation and lower unemployment in the short run if people underestimated the effect of the policy on inflation. b. lower inflation and higher unemployment in the short run if people underestimated the effect of the policy on inflation. c. lower inflation and an indeterminate effect on unemployment in the short run, if people's expectations were correct. d. both (b) and (c).
The Consumer Price Index (CPI)
a. measures the prices of all goods produced in the economy b. includes prices of raw materials c. is found by averaging the prices of all goods consumed in the economy d. includes only the prices of domestically produced consumer goods e. includes the prices of some used consumer goods
The supply curve of a natural resource like oil has a positive slope because
a. the supply becomes closer to exhaustion as demand rises. b. it becomes more costly to find and develop supplies as demand rises. c. rents rise as output increases. d. indirect taxes rise with output.