James has a comparative advantage in the production of corn, while Harry has a comparative advantage in the production of bread. If James and Harry decide to trade with each other, _____
a. both Harry and James will enjoy gains from trade
b. only Harry will enjoy gains from trade
c. only Harry will suffer losses from trade
d. only James will suffer loses from trade
e. neither of them will gain from trade
a
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If an economy has successful assigned policies under a fixed exchange regime, what will they have to do if they choose a new floating exchange regime?
A) Switch which agency is focused on internal vs. external balance. B) nothing C) Watch closely for signs of inflation which may trigger a policy misalignment problem. D) The answer is dependent upon their level of capital mobility which is unknown.
The total quantity of goods and services demanded by households, firms, foreigners, and government at varying price levels is
a. real GDP b. aggregate demand c. market demand d. total demand e. nominal GDP
In 1960, spending on income transfers and health care accounted for 21.5 percent of the federal budget. In 2012, these two items accounted for
a. less than 15 percent of the federal budget. b. approximately 25 percent of the federal budget. c. approximately 37 percent of the federal budget. d. approximately 57 percent of the federal budget.
Empirical economics refers to the
A. exclusion of irrelevant data when analyzing a model. B. belief that what is true for a part is necessarily true for the whole. C. model of economics used prior to the Industrial Revolution. D. collection and use of data to test economic theories.