Refer to the information provided in Table 20.4 below to answer the question(s) that follow.
Table 20.4GermanyChileBeerWineBeerWine(cases)(cases)(cases)(cases)75030 060152412453018 24304512 361560 6 48075 0 60 Refer to Table 20.4. Chile has
A. an absolute advantage and a comparative advantage in beer production.
B. an absolute advantage and a comparative advantage in wine production.
C. a comparative advantage in wine production.
D. neither a comparative advantage in wine production nor in beer production.
Answer: C
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Using average price and average quantity, calculate the price elasticity of demand if a price rise from $8 to $10 and decreases the quantity demanded from 20 units to 15 units. The price elasticity of demand equals
A) 2.5. B) 1.29. C) 0.78. D) 0.06
For the recessions in the United States since the 1950s,
A) unemployment falls on average by 2 percentage points during the 12 months after a recession begins. B) unemployment rises on average about 5 percentage points during the 12 months after a recession begins. C) cyclical unemployment has been non-existent. D) unemployment rises on average by about 1.2 percentage points during the 12 months after a recession begins.
Which of the following is an example of risk in capital budgeting on a global basis?
A) exchange rate changes B) tariff changes C) expropriation D) All of the above
Which of the following tax changes would a supply-side economist be most likely to favor?
a. eliminating an investment tax credit b. an increase in the capital gain tax c. lower marginal income tax rates d. an increase in the personal income tax rate for high-income individuals