By specializing in the production of particular goods in which it has a comparative advantage, a nation is:
A) less likely to make efficient use of available resources.
B) less likely to engage in international trade.
C) able to become self-sufficient.
D) able to operate efficiently.
Ans: D) able to operate efficiently.
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If an increase in investment spending of $50 million results in a $400 million increase in equilibrium real GDP, then
a. the multiplier is 0.125. b. the multiplier is 3.5. c. the multiplier is 8. d. the multiplier is 50.
In the economic way of thinking, private property rights provide people with
A) rules of the game. B) dependable information. C) incentives. D) none of the above. E) all of the above.
The table above shows Mary's utility from chips and soda. Mary buys only chips and soda. Chips cost $2 per bag and soda costs $4 per six-pack. She has $20 to spend per week. To maximize her utility, Mary will buy
A) 5 sodas and 5 bags of chips. B) 3 sodas and 3 bags of chips. C) 8 sodas and 8 bags of chips. D) 6 sodas and 2 bags of chips.
Which of the following is closest to the future value of a $4,000 deposit earning 2 percent interest annually after 10 years?
A. $4,122 B. $4,876 C. $5,025 D. $4,805