Economics demonstrates that opening up unrestricted free international trade is beneficial to all nations. However, are there any losers from such a policy change?
What will be an ideal response?
Yes, there are losers from opening up to free trade. Domestic suppliers of imported goods lose from allowing free trade. Owners of the businesses lose as do workers who had jobs in the import-competing industries. However, it is important to realize that although there are losers from free trade, there also are substantial gains and the gains exceed the loses so that the nation as a whole is made better off with free trade.
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According to Scenario 8.1, Fizzle and Sizzle
A) would be perfectly competitive if their purification costs were equal; otherwise, not. B) would be perfectly competitive if it costs Fizzle $500,000 yearly to keep that land. C) may or may not be perfect competitors, but their position on the river has nothing to do with it. D) cannot be perfect competitors because they are not identical firms.
Suppose that the Fed decides to decrease the growth rate of the money supply in the United States. What is most likely to happen to the U.S. trade deficit and to GDP?
a. The trade deficit will fall; GDP will fall. b. The trade deficit will rise; GDP will rise. c. The trade deficit will fall; GDP will rise. d. The trade deficit will rise; GDP will fall.
A person who is not working and who has looked for work in the past, but is not looking for work now is not considered "unemployed."
Answer the following statement true (T) or false (F)
Monetary policy is most likely to result in inflation when the aggregate supply curve is
A. Horizontal and the Fed lowers the reserve ratio. B. Horizontal and the Fed sells securities. C. Vertical and the Fed raises the reserve requirement. D. Vertical and the Fed lowers the discount rate.