Requiring a firm with international operations to follow the standards of its home country instead of those of the foreign country has all of the following advantages EXCEPT
A) it takes care of the fear of a race-to-the-bottom by making it impossible for a home-based company to exploit low standards.
B) it shifts the costs of improved standards to firms and consumers in high-income countries.
C) it removes the threat of domestic firms relocating abroad for low standards and ensures that any relocation that takes place is due to foreign comparative advantage.
D) it avoids the problems of high-income countries dictating what standards are to be used. In this situation, firms that cross national boundaries must conform to whichever standards are higher.
E) it is a comprehensive measure, since it addresses the problem of production in foreign firms as well as firms from high-standards countries that relocate abroad.
Ans: E) it is a comprehensive measure, since it addresses the problem of production in foreign firms as well as firms from high-standards countries that relocate abroad.
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The leadership of the Federal Reserve System is provided by
A) the Board of Governors. B) the Federal Advisory Committee. C) the Federal Open Market Committee. D) the directors of the twelve Federal Reserve banks.
In general, as productivity levels increase, the potential for productivity growth
a. decreases. b. increases. c. remains the same. d. increases if GDP increases.
Refer to the graph shown.
If suppliers can reduce output from M to L, the remaining firms in the market that are still producing L will find that their revenues will rise by:
A. area A, B, and C. B. area B. C. area A, B, and D. D. area A.
All of the following are consequences of an economy operating above its potential level except:
A. high rates of inflation. B. stable prices. C. high interest rates. D. low unemployment.