The government borrows by selling bonds. The DEBT
What will be an ideal response?
DEBT is the sum of all yearly deficits (note that states must balance their yearly budgets; they are not allowed to accrue debt like the federal government)
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Most migrants move from developing to developed nations
Indicate whether the statement is true or false
If country X can produce a unit of good 1 at a lower opportunity cost than can country Y, it is correct to state that country X
A) has a comparative advantage in producing good 1. B) has an absolute advantage in producing good 1. C) will import good 1 from country Y. D) will not produce good 1.
Suppose fiscal authorities raise state income tax rates. As a result, disposable income falls, thereby
A) decreasing consumption spending, and causing the aggregate demand curve to shift to the left. B) decreasing consumption spending, and causing a movement along a given aggregate demand curve. C) increasing saving, and causing the aggregate demand curve to shift to the left. D) increasing saving, and causing a movement along a given aggregate demand curve.
Countries can expect to gain from international trade as long as they:
A. use trade restrictions to reduce competition for domestic producers. B. keep production diversified. C. specialize according to their comparative advantage. D. produce only those goods for which they have a relatively high opportunity cost.