Describe the situation in the market for a good or service that the United States imports
What will be an ideal response?
The goods and services the United States will import are those in which the United States has a higher opportunity cost of production relative to other countries. In those markets the U.S. no-trade price is higher than the world price. With trade the quantity produced in the United States is less than the quantity consumed and the difference is imported.
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Consider the salary of Mary Sue Nelson, a sales agent for Plain Truth Advertising. Her weekly compensation package is W = 1,000 + 0.4Q, where Q is her dollar volume of sales. Her productivity is Q = 200e + µ, where e denotes her hours of effort and µ, is a random variable with mean 0. If Mary Sue works an additional hour, the expected value of her wages rises by:
A. $80.00. B. $200.00. C. $0.00. D. $1,000.00.
Investments
A. are more profitable when interest rates rise. B. are less profitable when interest rates rise. C. are more profitable when economic rents rise. D. are less profitable when economic rents rise.
If price exceeds marginal cost, we say that a firm receives
a. Extraction surplus b. User costs c. Consumer surplus d. Royalty payments e. Resource rents
Exhibit 12-1 Business cycle
?
In Exhibit 12-1, the recession phase of the business cycle can be represented by point(s):
A. CDE. B. BCD. C. EFG. D. A and E.