Suppose GDP is $10 billion, consumption expenditure is $7 billion, investment is $2 billion, and government purchases of goods and services is $2 billion. Net exports of goods and services must be
What will be an ideal response?
-$1 billion.
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Those costs implied by alternatives given up are
a. explicit costs. b. historical costs. c. outlay costs. d. implicit or opportunity costs.
As Europe explored monetary union, evidence to date suggests that increased variability in exchange rates
A) reduces foreign trade and investment. B) increases foreign trade and investment. C) does not seem to have an impact on foreign trade and investment. D) hurts foreign investment but not trade. E) hurts foreign trade but not investment.
If the price of Pepsi-Cola increases from 50 cents to 60 cents per can and the quantity demanded decreases from 100 cans to 50 cans, then the demand for Pepsi-Cola is
a. unit elastic b. perfectly elastic c. perfectly inelastic d. relatively elastic e. relatively inelastic
The concept of "scarcity" implies that: a. all output combinations below a nation's production possibilities frontier is unattainable
b. a nation should allocate its resources to the production of only one good. c. a nation is limited in its capacity to produce goods and services by its available resources and technology. d. all production combinations above a nation's production possibilities frontier are inefficient.