Refer to the information provided in Figure 20.4 below to answer the question(s) that follow.
Figure 20.4Refer to Figure 20.4. The domestic price of a leather wallet is $20. With free trade the price of a leather wallet is $10 and after a tariff is imposed the price is $15. After the tariff is imposed, this country will ________ 250 leather wallets.
A. sell
B. export
C. import
D. buy
Answer: D
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When output exceeds planned expenditures, there is insufficient production in the economy
Indicate whether the statement is true or false
"When a person has an absolute advantage in producing a good, the person necessarily has a lower opportunity cost of producing it." Is this assertion true or false?
What will be an ideal response?
When potential GDP increases, the potential GDP line ________, and the aggregate supply curve ________
A) shifts rightward; shifts rightward B) shifts rightward; shifts leftward C) shifts leftward; shifts rightward D) shifts leftward; shifts leftward E) shifts rightward; does not shift
Upon getting a big promotion, Sally decides to buy a house in the neighborhood she grew up in as a child. In fact, the house she buys used to belong to a neighbor of hers, and so she's certain it's in good shape and well worth the $200,000 she pays for it. The only thing Sally needs to do is replace all the gutters for $1,000, which she happily does. How will GDP be affected by Sally's recent purchases?
A. Consumption will increase by $210,000. B. GDP will increase by $1000. C. Consumption will increase by $1,000, and investment will increase by $200,000. D. Investment will increase by $201,000.