Intraindustry trade tends to be more controversial than interindustry trade
Indicate whether the statement is true or false
FALSE
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A decrease in the price of foreign oil will affect the U.S. economy by
a. increasing aggregate demand. b. decreasing aggregate demand. c. increasing aggregate supply. d. decreasing aggregate supply.
Opening trade between two nations would:
A. shift their production possibilities curves outward. B. shift their production possibilities curves inward. C. leave the production possibilities unchanged and increase their consumption possibilities. D. leave the production possibilities unchanged and decreased their consumption possibilities.
Answer the following statements true (T) or false (F)
1. If the money supply growth is set at a slower pace than the growth of real GDP, then inflation will occur. 2. Rational expectations theory suggests that changes in people's expectations in response to changes in fiscal and monetary policy changes will make such policy-changes ineffective. 3. Monetarists believe that a monetary policy rule will tend to lead to inflation. 4. The mainstream view of the economy since 1946 is that it has become more stable because of the use of discretionary fiscal and monetary policies. 5. Monetarists and rational-expectations theorists both favor policy rules and both argue against discretionary policy.
Hotelling's model has been used to describe differentiation in the political "market." Suppose that 100 voters are evenly distributed between the extreme left and the extreme right on the political spectrum, and that all voters vote, and they always vote for the candidate closest to them on this spectrum. The numbers on this spectrum represent the number of voters lying to the left of the number. So, at the midpoint, fifty voters lie to the left and fifty to the right. At the extreme right end, all 100 voters lie to the left. 
width="553" />If Candidate Y is running against Candidate Z: A. Neither candidate has any incentive to move. B. Both candidates will have an incentive to move to the left. C. Candidate Y will have an incentive to move to the left, and Candidate Z will have an incentive to move to the right. D. Both candidates will have an incentive to move toward each other's position.