? Which of the following transactions would be recorded as a debit in the U.S. current account?
a. the purchase of air service from a U.S. airline by a Japanese traveler
b.? the purchase of U.S. grain by a Japanese bakery
c. the purchase of a Japanese car by an American
d.? a short-term loan extended to a Japanese manufacturer by a U.S. bank
Answer: c. the purchase of a Japanese car by an American
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George Herman (Babe) Ruth was a superb baseball player, both an excellent pitcher and a record-breaking batter
Other members of the New York Yankee team, who were not as competent pitchers as Ruth, nonetheless had a comparative advantage over Ruth in pitching because A) Ruth was such a competent batter. B) the owners of the Yankees were more interested in monetary profits than in winning baseball games. C) the price system failed to provide adequate information and incentive. D) they were allowed to pitch more often and practice increased their productivity. E) too many players preferred batting to pitching.
In the foreign exchange market, the quantity supplied of dollars is 300 whereas the quantity demanded of dollars is 500 results in a:
A) balance of payments surplus of 200. B) balance of payments deficit of 200. C) balance of payments surplus of -200. D) balance of payments deficit of -200.
Assume that the budget constraint in the figure below is: P E E + P A A = I, where I is total income and P E is the price of education and P A is the price of all other goods. If U(E,A) = A + E, P E = 2, P A = 1, and I = 10. What is the quantity of education and all other goods consumed?
Suppose an economy consists of 500,000 individuals 16 years and older, 260,000 are employed, and 21,000 are unemployed but actively seeking work. In this example the unemployment rate is approximately:
A. 4.2 percent. B. 6.1 percent. C. 7.5 percent. D. 8.0 percent.