Chapter 12
What will be an ideal response?
Bankruptcy filing by the consumer indicating their inability to pay
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Aggregate demand and aggregate supply must be combined to determine the price level and the "real" GDP
Indicate whether the statement is true or false
The figure above shows how the PPF for cell phones and new cell-phone factories can expand. In the figure, if the economy produced 4 million cell phones using the resources efficiently, the PPF would
A) expand farther than shown in the figure. B) expand along the vertical axis and not along the horizontal axis. C) expand, but not as far as shown in the figure. D) expand evenly along both axes. E) not expand.
Rent controls carry long-run unintended consequences, such as
A) a fairer price for people who can't afford market-determined rents. B) improved quality of apartment units. C) fewer apartment units as landlords seek substitute uses of their property. D) an increase in rental price competition among landlords.
In 1975, wage levels in South Korea were roughly 5% of those in the United States
It is obvious that if the United States had allowed Korean goods to be freely imported into the United States at that time, this would have caused devastation to the standard of living in the United States, because no producer in this country could possibly compete with such low wages. Discuss this assertion in the context of the Ricardian model of comparative advantage.