If the opportunity cost of corn to wheat is 3:1 in the United States and 5:1 in France, only the United States would benefit from trade if the actual terms of trade between corn and wheat were 2:1.
Answer the following statement true (T) or false (F)
False
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The "time inconsistency" argument is that a downward shift of the short-run Phillips Curve, which comes about with a ________ of inflationary expectations, is more likely when monetary policy ________
A) lowering, follows a rigid rule B) lowering, is at the discretion of policymakers C) raising, follows a rigid rule D) raising, is at the discretion of policymakers
Since the 1980s, China's output per person has increased tremendously. Which of these possible contributors to economic growth in China is a good example of a positive supply shock?
A) high levels of saving and investment B) declining rate of population growth C) rising consumption of energy D) all of the above E) none of the above
An article in the Wall Street Journal in early 2001 noted two developments in the market for laser eye surgery. The first development concerned side effects from the surgery, including blurred vision. The second development was that the companies renting
eye-surgery machinery to doctors had reduced their charges. In the market for laser eye surgeries, these two developments A) decreased demand and decreased supply, resulting in a decrease in the equilibrium quantity and an increase in the equilibrium price of laser eye surgeries. B) decreased demand and increased supply resulting in an increase in both the equilibrium quantity and the equilibrium price of laser eye surgeries. C) decreased demand and increased supply, resulting in a decrease in the equilibrium price and an uncertain effect on the equilibrium quantity of laser eye surgeries. D) decreased demand and increased supply, resulting in a decrease in both the equilibrium price and the equilibrium quantity of laser eye surgeries.
Multinationals
What will be an ideal response?