The ratio at which one country trades a domestic product for imported product is that country's
A. comparative advantage.
B. cost ratio.
C. terms of trade.
D. absolute advantage.
Answer: C
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Assuming all excess reserves are loaned out, currency holdings by the public are zero, and a reserve ratio of 5 percent, an initial deposit of $10,000 will lead to a total increase in deposits of
A) $500. B) $10,000. C) $50,000. D) $200,000.
The supply of milk in Nexus City is perfectly elastic. If a tax is imposed on each gallon of milk sold, ________
A) the burden of the tax will fall entirely on the sellers B) the burden of the tax will fall entirely on the buyers C) the tax incidence on the sellers is higher than that on the buyers D) the deadweight loss due to taxation is zero
In the first years of a professional athlete's career, the athlete is "under reserve," which means that he or she cannot negotiate with other teams. This creates a de facto
A) monopolist. B) monopsony. C) duopoly. D) bilateral monopoly.
The economy's current rate of interest is 10 percent and a firm has $10,000 of owner-invested capital. Its total revenue is $5000 and the firm's explicit costs are $3500. From this we know that this firm's
A) accounting profit is $500. B) economic profit is $1,500. C) accounting profit is $1,500. D) economic profit is $5,000.