Describe several components of the institutional environment in the HPAEs that are critical to their success
What will be an ideal response?
Property rights are secure, bureaucracies are competent, contracts are enforceable, access to information is widespread, and regulations are clear and well publicized.
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Fill in the blank: Rent controls tend to ________ discrimination among landlords
A) increase nonprice B) increase price C) decrease nonprice D) eliminate
Monopolistically competitive firms could reduce the average total cost of producing by increasing output; therefore, these firms have
Suppose country Alpha must give up 2 units of clothing for each unit of food produced, while country Omega must give up 1/2 of a unit of clothing for each unit of food produced. If specialization and trade were to occur between these two fictitious countries, which of the following would be consistent with comparative advantage and mutually advantageous trade?
a. Omega will sell food to Alpha at a price of 1 unit of clothing for 1/2 unit of food. b. Omega will sell food to Alpha at a price of 1 unit of clothing for each unit of food. c. Alpha will sell food to Omega at a price of 2 units of clothing for each unit of food. d. Alpha will sell food to Omega at a price of 1 unit of clothing for each unit of food.
When the United States has a current account deficit, it must ______.
a. reduce the difference by increasing its unilateral transfers to foreigners b. finance the difference by importing more goods and services than it sells c. finance the difference by borrowing or by selling more capital assets than it buys d. increase the difference by borrowing or by buying more capital assets than it sells