A key point in the difference between the United States and the European Union as OCAs, is that:
A) the intra-European Union trade is significantly higher than the intrastate trade in the United States.
B) the intra-European Union trade is significantly lower than the intrastate trade in the United States.
C) the intra-European Union labor migration is much higher than the intrastate migration in the United States.
D) in the United States, language creates a significant barrier.
Ans: B) the intra-European Union trade is significantly lower than the intrastate trade in the United States.
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If prices have increased since the base period, then
A) real GDP is larger than nominal GDP. B) real GDP can no longer be compared to nominal GDP. C) real GDP is equal to nominal GDP. D) real GDP is smaller than nominal GDP. E) there is no way to adjust nominal GDP so that it equals real GDP.
One explanation for the fall in the value of the U.S. dollar since 2001is
a. the mix of an tight fiscal/tight monetary policy over the period. b. the relative weakness of the U.S. economy over the period. c. a higher degree of accommodation of supply shocks in the United States relative to our trading partners. d. the disintegration of the Bretton Woods system during these years.
Firm X both produces automobiles and owns gas stations. If decides to decrease the gas to induce higher sales for the automobiles, it means that
a. the gas and the automobiles are complements b. the gas and the automobiles are substitutes c. the gas and the automobiles are not related in demand d. none of the above
A firm will only earn normal profit in the long run
a. if firms can freely enter or leave the market b. if firms do not try to maximize profit c. only if the industry is perfectly competitive d. whenever products are not differentiated e. if barriers to entry exist