The U.S. Customs Service reclassified imports of compact trucks (like the Toyota Tacoma) from "cab and chassis with some final assembly needed" to "complete or unfinished trucks." As a result of this reclassification, a tariff of _____ was applied, and U.S. prices of Japanese compact trucks rose by _____.
a. 25%; 25%
b. 25%; more than 25%
c. 25%; less than 25%
d. 4%; more than 4%
Ans: c. 25%; less than 25%
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Foreign direct investment occurs when a Chinese corporation
A) opens a new Chinese factory. B) purchases stock issued in China. C) purchases 1,000 shares of stock issued by an American company. D) opens a new factory in France.
Consider the following hypothetical data for a developing country:
Year Total Debt ($ bn) Debt/Export (%) GDP Growth Inv. Growth 1 6 134 0.6% –1.0% 2 6.5 147 2.9% 1.1% 3 7 159 5.1% 1.6% 4 7.5 174 6.4% 2.4% 5 8 198 1.1% –0.6% Does this country have a debt crisis? What additional pieces of quantitative or qualitative evidence (if any) would help you to decide?
In the short run, when a firm stops producing it:
A. avoids paying fixed costs. B. avoids paying variable costs. C. can avoid earning profits less than zero. D. must be that ATC is lower than market price.
In deciding where to operate along its production possibilities frontier, a society is answering the question of
a. which goods and services should be produced with its scarce resources b. what production methods should be used to produce goods and services c. how will output be allocated among the individuals in the society d. what prices will be charged for goods and services e. how much will it trade with other societies in the world