If General Motors buys steel from Russia, then the purchase will be recorded in the:
A. U.S. current account.
B. Russian government financial account.
C. U.S. government financial account.
D. U.S. financial and capital account.
Answer: A
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Consider the hypothetical supply and demand of Kidneys.
Initially, kidneys are exchanged by donations only (price=0). If the government decides to legalize kidney sales and the market reaches equilibrium, then:
A. total surplus increases.
B. consumer surplus remains the same.
C. producer surplus remains the same.
D. a shortage of kidneys will arise.
Which of the following is true of the General Agreement on Tariffs and Trade (GATT)?
a. It is now called the World Agreement on Trade and Tariffs. b. It was the global trade agreement that did away with the gold standard. c. It was a policy of the United States to raise tariffs on imported sugar. d. It was the first global trade agreement that followed World War II. e. It was a global trade agreement to raise tariffs.
Flat tax
A. is same tax rate to everyone. B. is same tax rate to each component of income. C. allows a tax base with no deductions with a few exemptions and expenses. D. is same tax rate to everyone and to each component of income only. E. all of these answer options are correct.
A village has five residents, each of whom has an accumulated savings of $50. Each villager can use the money to buy a government bond that pays 10% interest per year or to buy a year-old goat, send it onto the commons to graze, and sell it after one year. The price of the goat that the villager will get at the end of the year depends on the amount of weight it gains while grazing on the commons, which in turn depends on the number of goats sent onto the commons, as shown in the table below. Assume that if a villager is indifferent between buying a bond and buying a goat, the villager will buy a goat. Number of goatson the commonsPrice per 2-yearold goat ($)Income pergoat ($/year)180302752537020465155555 The villagers will buy a year-old goat if the goat can be sold for a price of at
least ________ when it is 2 years old. A. $65 B. $55 C. $75 D. $70