Explain the "vicious-circle-of-poverty" hypothesis
What will be an ideal response?
Suggests that poverty is self-perpetuating because poor nations are unable to save and invest enough to accumulate the capital stock that would help them grow.
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A country has a comparative advantage in the production of a good if its opportunity cost is lower compared to another country
Indicate whether the statement is true or false
During the 100 years before the Revolutionary war, shipping costs were reduced by nearly:
a. 10 percent. b. 25 percent. c. 50 percent. d. 70 percent. e. Shipping costs increased during that period.
Which of the following involves signaling?
a. high wage rates attracting a larger pool of applicants for a job b. firms taking advantage of outsourcing when transactions costs are low c. reporting one's college GPA on a resume d. paying higher wages to workers who produce more e. requiring the sales staff to work strictly on commission
The Keynesian approach to economic policy is also known as: a. supply-side economics. b. Classical economics
c. demand-side economics. d. mercantilism. e. laissez-faire.