Suppose that a worker in Freedonia can produce either 6 units of corn or 2 units of wheat per year, and a worker in Sylvania can produce either 2 units of corn or 6 units of wheat per year. Each nation has 10 workers. For many years the two countries traded, each completely specializing according to their respective comparative advantages. Now, however, war has broken out between them and all
trade has stopped. Without trade, Freedonia produces and consumes 30 units of corn and 10 units of wheat per year. Sylvania produces and consumes 10 units of corn and 30 units of wheat. The war has caused the combined yearly output of the two countries to decline by
a. 10 units of corn and 10 units of wheat.
b. 20 units of corn and 20 units of wheat.
c. 30 units of corn and 30 units of wheat.
d. 40 units of corn and 40 units of wheat.
b
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Households receive transfers from ________, and firms receive transfers from ________
A) firms; households B) government; government and households C) government; no one D) firms and government; government E) government; government
Mutual funds that invest only in companies that meet certain criteria and usually exclude companies that produce tobacco, weapons, or alcoholic beverages are known as:
a. socially responsible funds. b. global funds. c. equity funds. d. fixed-income funds. e. money market funds.
The cause of the "greenhouse effect" is the
a. increasing use of glass in construction. b. growth of desertification. c. burning of "fossil fuels." d. decline in carbon dioxide in the atmosphere.
Which of the following statements accurately describes the economy with a recessionary gap?
a. SRAS intercepts AD1 at RGDPNR.
b. RGDP1 is less than RGDPNR.
c. ESR occurs along LRAS.
d. SRAS intercepts LRAS at ESR.