If a perfectly competitive firm cannot cover all of its costs, then it should shut down in the short run
a. True
b. False
Indicate whether the statement is true or false
False
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Answer the following statements true (T) or false (F)
1. Only in developing nations would one expect the value of either exports or imports to exceed 200 percent of gross national product. 2. In dollar value, the United States is the largest importer in the world. 3. The value of U.S. exports is about 10 percent of its GDP. 4. Although political arguments strongly favor free trade, most decisions affecting international trade are made in the economic arena. 5. The only factor determining whether a country can develop a comparative advantage in production is the degree to which it has a highly skilled labor force.
The "infant industry argument" recommends protectionism for industries that produce children's clothing
a. True b. False Indicate whether the statement is true or false
Increased government spending for investments such as highways or harbors financed by increasing the public debt would most likely:
A. increase the amount of private capital stock in the future. B. increase the amount of public capital stock in the future. C. crowd out future public investment. D. reduce the economy's future productive capacity.
According to the quantity theory of money, an excess quantity of money supplied will lead to
A. a higher level of employment. B. a higher price level. C. a reduction in spending and higher interest rates. D. a reduced level of real Gross Domestic Product (GDP).