Creative destruction means that
A) economic growth can only be sustained if capital depreciates rapidly.
B) firms develop new products that replace old products in the economy, thereby encouraging economic growth.
C) research and development should only be financed if research and development is incremental (a result of making small changes to existing products).
D) knowledge capital can be created through a system of government subsidies for education and research and development.
B
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If the value of the U.S. dollar changes from 1.2 euros to 1.4 euros, we would expect that the United States would experience a ________ in exports and a ________ in imports
A) rise; rise B) fall; fall C) rise; fall D) fall; rise
Nontariff barriers to trade are less transparent than tariffs
Indicate whether the statement is true or false
For which of the following medical goods or services is the income elasticity of demand likely to be largest?
a. emergency services after a car accident b. measles shots c. physical examinations for life insurance applications d. medical tests to diagnose specific symptoms e. face-lifts
If the long-term labor force growth rate is 1.2% and the long-term productivity growth rate is 2.4%, then the
A. spending multiplier is 2. B. potential growth rate is 3.6%. C. real GDP per capita growth rate is 0.5%. D. short-term growth rate is 1.2%.