In autarky,
a. each country's consumption possibilities are the same as its production possibilities
b. equilibrium is attained with the maximum gains from specialization and trade
c. equilibrium is attained with the maximum amount of international trade
d. a nation has such a high standard of living that there are technically no poor people
e. a nation is governed by an individual with absolute authority
A
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The two most important factors contributing to increased productivity in industrialized countries in the twentieth century were:
A. higher relative prices and technological progress. B. higher relative prices and a larger labor supply. C. technological progress and increases in the labor supply. D. technological progress and increases in the capital stock.
Under a tariff, the domestic government gains revenue, but under an import quota it does not, unless it sells the quota rights
a. True b. False
Which of the following is the best example of an action that imposes an external cost?
A. Wear and tear on your car as the result of frequent use. B. Deterioration in the average quality of a house you own as the result of poor maintenance. C. Water pollution from an upstream factory that increases the cost of providing clean water to downstream residents. D. A rose garden on your property from which your neighbor gets much enjoyment.
Consider a world with two income earners and an income tax. Individual A earns $25,000 and pays $1,000 in taxes. Individual B earns $100,000 and pays $3,000 in taxes. Which of the following best classifies the income tax system in this world?
a. proportional b. progressive c. regressive d. consumption