The graph above shows the PPC for a country that can produce oil, which is labor intensive, or televisions, which are capital intensive. The country is currently producing at point A and not trading with the rest of the world. With trade, the world price can be represented by slope of the straight line through Point A. Which of the following is a true statement?
A) When this country produces the optimal amount with trade, workers in this country will be better off.
B) When this country produces the optimal amount with trade, capital in this country will be better off.
C) When this country produces the optimal amount with trade, both factors of production will be better off.
D) When this country produces the optimal amount with trade, the income of factors of production will not change.
A
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For choice sets emerging from "exogenous" income, the budget line will shift parallel whenever both prices change by the same percentage.
Answer the following statement true (T) or false (F)
The ________ the portion of your income spent on a good, the ________ is your demand for the good
A) larger; more income elastic B) larger; more price elastic C) smaller; less price elastic D) smaller; more income elastic
If the required reserve ratio is 5 percent, then the simple deposit multiplier is
A) 2. B) 5. C) 10. D) 20.
One of the most important factors in determining the natural rate of unemployment is demographic change, such as a change in the age of the labor force
a. True b. False Indicate whether the statement is true or false