Which of the following statements about comparative advantage is FALSE?
A. International trade will benefit an entire economy, but some particular groups of people may be hurt by expanding trade.
B. A country's comparative advantage cannot be determined by looking only at its own economy.
C. Expanding international trade hurts a nation's economy if it causes the nation's currency to depreciate.
D. There is always a trade between two countries that can make both better off.
Answer: C
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A key assumption of new growth theory is that
A) all technological change is the result of luck. B) higher incomes lead to a higher birth rate. C) a successful innovator has the opportunity to earn a temporary, above-average profit. D) the population growth rate is lower than the real interest rate.
If income decreases, there will be a parallel inward shift of the budget line
a. True b. False
An expansionary gap creates labor shortage that eventually results in a higher nominal wage and a lower price level
Indicate whether the statement is true or false
The demand for a movie ticket is probably ________ than is the demand for a Broadway show ticket because ________.
A. less price elastic; a movie ticket has fewer available substitutes. B. more price elastic; a movie ticket requires a smaller portion of one's income. C. more price elastic; a movie ticket has fewer available substitutes. D. less price elastic; a movie ticket requires a smaller portion of one's income.