Country A is labor abundant relative to country B if it has a larger labor force than B's
Indicate whether the statement is true or false
FALSE
Explanation: The ratio of labor to capital determines abundance.
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If the United States could produce 4 tons of potatoes or 2 tons of wheat per worker per year, while Ireland could produce 2 tons of potatoes or 3 tons of wheat per worker per year, the country with the comparative advantage in producing potatoes is ____ and the country with the absolute advantage in producing potatoes is ____
a. the United States; the United States b. the United States; Ireland c. Ireland; the United States d. Ireland; Ireland
A hypothetical bank accepts cash deposits from all its clients. The bank promises that all the funds deposited with it are absolutely secure and available to the depositors whenever they need them. In the given scenario, which of the following is true? a. The bank holds 100 percent reserves with itself. b. The bank holds 50 percent reserves with itself. c. The bank makes loans at steep
interest rates. d. The bank invests only in securities.
If a hurricane were to wipe out the majority of the eastern seaboard in the United States:
A. neither the short-run nor long-run aggregate supply curves would be affected. B. only the long-run aggregate supply curve would shift left. C. only the short-run aggregate supply curve would shift left. D. the long-run and short-run aggregate supply curves would both shift left.
A public debt that is owed to foreigners can be burdensome because:
A. payment of interest will necessarily have a deflationary effect on prices in the paying nation. B. payment of interest will conflict with a nation's foreign aid programs. C. payment of interest reduces the volume of goods and services available for domestic uses. D. foreign interest rates are persistently higher than domestic interest rates.