The gains from specialization and trade are based on absolute advantage
a. True
b. False
Indicate whether the statement is true or false
False
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Holding all else constant, an increase in the real interest rate on U.S. assets will ________ the demand for dollars in the foreign exchange market and ________ the equilibrium Mexican peso/U.S. dollar exchange rate.
A. increase; increase B. decrease; decrease C. increase; decrease D. decrease; increase
Rhode Island has enacted a substantial increase in the tax on employers that finances the workman's compensation system. For some employers, the tax is about $25 per $100 paid in wages. Employers claim they cannot afford to pay the tax. Under which of the following conditions will the actual burden of the tax fall on employers?
a. The employers' demand for labor is perfectly elastic. b. The supply of labor is perfectly inelastic. c. The employers' demand for labor is perfectly inelastic. d. The demand for the good they produce must be perfectly inelastic.
Public choice deals exclusively with business decisions
Indicate whether the statement is true or false
The railroad industry in the United States is used as an example of ______.
a. the deadweight loss caused by perfect competition b. government ownership of monopolies c. how monopolies can fail to innovate d. how monopolies are innovators