When the exchange rate for the Mexican peso changes from 10 pesos to the U.S dollar to 9 pesos to the U.S. dollar, then the Mexican peso has ________ and the U.S. dollar has ________
A) appreciated; appreciated
B) depreciated; appreciated
C) appreciated; depreciated
D) depreciated; depreciated
C
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Refer to Table 7-5
a. Which person has an absolute advantage in the production of pens? Pencils? b. Which person has a comparative advantage in the production of pens? c. Which person has a comparative advantage in the production of pencils?
The misperceptions theory was originally proposed by ________ and rigorously formulated by ________
A) Milton Friedman; Robert Lucas B) John Maynard Keynes; Robert Solow C) Edward Prescott; Robert King D) James Tobin; Greg Mankiw
Most firms have
a. no monopoly pricing power. b. some monopoly pricing power. c. absolute monopoly pricing power. d. the ability to earn monopoly profits.
When robots are used to replace workers on a factory production line, the wage gap between skilled and unskilled workers
a. will increase only if the company can increase the price of its product. b. is likely to increase. c. is likely to decrease. d. will not change.