Textile workers in the U.S. complain that they cannot compete with low cost foreign textile producers. While some U.S. textile workers may lose their jobs, an advantage is
a. the U.S. gets cheaper textiles
b. U.S. imports will become more expensive so U.S. domestic producers gain
c. workers in other countries will buy more U.S. clothing exports
d. the U.S. can retaliate and its exporting strength is greater
e. the U.S. can dump its textiles on other markets without fearing retaliation because U.S. textiles are made with high cost labor
A
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Suppose that the price of a Big Mac is a good approximation of the price level in the country. A Big Mac costs £2 in London and $3 in New York
a) If purchasing power parity holds, what is the exchange rate between the U.S. dollar and the British pound? b) If the current exchange rate is $1.6 per pound, what is the dollar price of a Big Mac in London? What do you predict will happen to the exchange rate? Explain. c) The exchange rate between the U.S. dollar and the Russian ruble is 30 rubles per dollar. If purchasing power parity holds, what is the price of a Big Mac in Moscow?
The real interest rate differs from the nominal rate in that ________
A) it more accurately represents the true cost of borrowing B) it varies negatively with changes in the rate of inflation C) it is the better indicator of credit market conditions D) all of the above E) none of the above
As the definition of products narrows (i.e., becomes more specific), the concentration ratio
A) is not valid. B) tends to decrease. C) tends to increase. D) does not change in any predictable manner.
Albert and Betty hire Christine and David to play music at their wedding. Elizabeth, who lives behind the church, cannot study because of the loud music. The third party is:
a. Albert. b. Betty. c. Christine. d. David. e. Elizabeth.