When Costa Rica's resources are not fully employed, then relative to its production possibilities curve, the point representing its production position is located
a. somewhere outside (exterior to) the curve
b. somewhere along the curve because it still has choice among those production possibilities combinations
c. somewhere inside (interior to) the curve
d. on a new production possibilities curve that is closer to the origin
e. on a new production possibilities curve that is further from the origin
C
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When income increases, the demand curve for X shifts rightward and the demand curve for Y shifts leftward. These shifts mean that
A) X and Y are complements. B) X and Y both normal goods. C) X is an inferior good and Y is a normal good. D) X is a normal good and Y is an inferior good.
Which of the following methods could be used by an employer to align the incentives of an employee with its own interests?
a. Paying market wages b. Paying efficiency wages c. Signaling d. Partially outsourcing human resource functions
The principle of comparative advantage holds that nations should
a. specialize in activities for which they have the lowest opportunity cost. b. strive to become self-sufficient in production. c. produce only goods and services for which they have absolute advantage. d. become less labor-intensive and more capital-intensive.
The fictional country of Alpetra increases the income tax rate so that tax revenues increase by $30 million. In response, consumption falls by $8 million. If GDP and government spending remains the same and Alpetra is a closed economy, what is the change in investment?
a. Investment increases by $8 million. b. Investment decreases by $8 million. c. Investment increases by $38 million. d. Investment decreases by $22 million.