The Leontief paradox found that:
a. exports should always be capital intensive.
b. imports should always be labor intensive.
c. U.S. exports were labor intensive.
d. U.S. exports were capital intensive
Ans: c. U.S. exports were labor intensive.
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Which of the following statements is (are) correct? The new classical economics
a. questions the soundness of the Keynesian model, arguing that many of its relationships are not firmly based on individual optimizing behavior. b. criticizes what it considers arbitrary assumptions of Keynesians concerning wage stickiness and consequent involuntary unemployment. c. favors the rational expectations assumptions over formulations that assume that individuals form price expectations on the basis of past history of prices because the rational expectations hypothesis is consistent with individual optimizing behavior. d. All of the above e. None of the above
The time and money it takes to organize a group or a campaign and to get the attention of lots of busy people is the:
A. cost of collective action. B. reason why collective action does not happen in the real world. C. reason why all individuals never participate in any collective action. D. initial set-up costs of the campaign or group.
Which of the following is a possible result of price confusion?
A. People are less able to take actions that mitigate the impact of monetary policy. B. Sellers will face pressure to provide more accurate pricing information. C. The price system becomes a less effective way to coordinate economic action. D. The signals that prices send become clearer and more necessary.
If a $100 billion decrease in investment spending causes income to decline by $100 billion the first round of the multiplier process and by $75 billion in the second round, income will eventually decline by:
A. $200 billion. B. $300 billion. C. $400 billion. D. $500 billion.