When free international trade takes place, in accordance with a country's comparative advantage,
a. producers in export industries are likely to favor it because they sell a larger quantity at identical prices
b. producers in export industries are likely to oppose it because they sell a larger quantity, which lowers prices in accordance with the laws of supply and demand
c. producers in import industries are likely to favor it because they sell a larger quantity at only slightly depressed prices
d. export industry workers are likely to favor it, import industry workers are likely to hate it
e. consumers are likely to be of two minds: they hate the more expensive import goods, but they love the cheaper export goods
D
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With everything else the same, in the foreign exchange market the
A) larger the value of U.S. exports, the greater is the quantity of dollars demanded. B) lower the exchange rate, the smaller the amount of U.S. exports. C) the lower the exchange rate, the smaller is the expected profit from buying dollars. D) the higher the exchange rate, the cheaper are U.S.-produced goods and services.
Everything else held constant, an expansionary ________ policy will cause the interest rate to rise, while an expansionary ________ policy will cause the interest rate to fall
A) monetary; monetary B) monetary; fiscal C) fiscal; monetary D) fiscal; fiscal
Sara looks into her closet and discovers a pair of like-new shoes she no longer wears because they give her blisters. From the economist's perspective, was Sara behaving rationally when she bought those shoes?
A) No. If any of a person's decisions have poor results, that person is irrational. B) Yes, as long as Sara didn't intentionally purchase blister-causing shoes. C) No. The rationality assumption states that rational people never make mistakes. D) It's not clear because psychology, not economics, deals with the rationality assumption.
This graph demonstrates the domestic demand and supply for a good, as well as the world price for that good.
According to the graph shown, if this were depicting an autarky, the amount being sold domestically is:
A. 115. B. 90. C. 60. D. 160.