Autarky refers to
A) a situation in which there is no trade.
B) the equilibrium a nation reaches after trade begins.
C) a situation in which nations trade goods and services.
D) the location on a consumption possibilities curve.
A
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When a tax on output is imposed to internalize the external costs of pollution, the supply curve shifts down by the amount of the tax
Indicate whether the statement is true or false
All of the following are roles of a exchange EXCEPT
A) instituting margin requirements on futures contracts. B) marking to market at the end of each day. C) eliminate the need for buyers and sellers of futures contracts to be concerned about the creditworthiness of each other. D) reducing the default risk involving forward contracts.
Statistical data provided by the U.S. Department of Transportation shows that the median income of individuals traveling on the nation's bus systems is $18,000 compared to $65,000 for those who normally travel by air. This finding is best explained by which of the following statements?
a. Persons with high income are more likely to fly because the opportunity cost of their time is generally higher than those with lesser income. b. Traditionally, lower income groups prefer slower methods of transportation. c. Wealthy individuals own stock in the airlines and, therefore, receive preferential treatment. d. Low-income groups are generally located near bus stations; wealthy groups congregate around airports.
Assume that business investment spending rises, and the increase is funded by greater borrowing in the capital markets. If the nation has low mobility international capital markets and a fixed exchange rate system, what happens to the nominal exchange rate and monetary base in the context of the Three-Sector-Model? a. The nominal exchange rate rises and monetary base rises
b. The nominal exchange rate remains the same and monetary base falls. c. The nominal exchange rate remains the same and monetary base rises. d. The nominal exchange rate and monetary base remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.