International trade arises from
A) absolute advantage.
B) comparative advantage.
C) importation duties.
D) the advantage of execution.
B
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The implication of the expectations theory that expected returns for a holding period must be the same for bonds of different maturities depends on the assumption that
A) yield curves usually slope upward. B) yield curves usually slope downward. C) instruments with different maturities are perfect substitutes. D) savers are usually risk averse.
All of the following accurately describes China's currency peg EXCEPT
A) pegging against the dollar ensured that Chinese exporters faced stable prices on exports to the U.S. B) some U.S. firms complained that the peg gave Chinese firms an unfair advantage over U.S. firms. C) the Chinese currency was allowed to depreciate moderately in the years preceding the financial crisis. D) many economists argued that the Chinese currency was undervalued.
For a tangible index of well-being, we can regard income as the only barometer necessary
Indicate whether the statement is true or false
An increase in the U.S. interest rate
a. raises the opportunity cost of holding dollars. b. induces households to increase consumption. c. shifts money demand to the right. d. leads to a depreciation of the U.S. dollar.