Suppose labor and capital are the only two resources used for production. In the short run:
a. only capital can move freely between sectors.
b. only labor can move freely between sectors.
c. both capital and labor can move freely between sectors.
d. both resources are restricted in their movement
Ans: b. only labor can move freely between sectors.
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Which of the following is counted as "capital" in economics?
A) the money people have B) the wealth people have C) the machines workers have to work with D) the labor force
Successful adjustment to external imbalance is likely to involve
a. expenditure-reducing policies b. expenditure-switching policies c. import compression d. devaluation of the national currency e. all of the above
Suppose Paraguay can produce 12 wheat or 3 corn. Suppose Bolivia can produce 4 wheat or 2 corn. Suppose opportunity costs are constant. Given these production possibilities,
A) Paraguay has a comparative advantage in wheat. B) Paraguay has a comparative advantage in corn. C) Paraguay has a comparative advantage in both goods. D) Paraguay has an absolute advantage in neither good.
Which of the following statements is correct concerning GDP and GNP?
A. GDP measures output produced by a nation's factors even if they are outside the nation's borders. B. GDP measures output within the nation's borders only. C. GNP measures output outside a nation's borders, but not inside it. D. GNP measures output within the nation's borders only.