Refer to Figure 4.4. At an interest rate of 7%,
A) Foreign borrowers have an incentive to offer lenders in the United States an interest rate greater than 7%.
B) Foreign lenders have an incentive to offer borrowers in the United States an interest rate less than 7%.
C) U.S. lenders have an incentive to offer borrowers in the rest of the world an interest rate of 7%.
D) U.S. borrowers have an incentive to offer U.S. lenders an interest rate greater than 7%.
B
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Table 7.1 exemplifies the principle of
A) diminishing returns. B) marginal costs. C) full employment equilibrium. D) real vs. nominal costs.
The law of one price holds exactly only if
A) buyers have complete information. B) antitrust laws are being enforced. C) it is impossible for buyers to resell the good. D) transactions costs are zero.
If the prices of computer tablets rise, we would expect the number of tablet covers purchased to
A) increase. B) decrease. C) be equal to ten. D) be equal to one.
Which of the following is not considered a barrier to entry?
A.) Control of essential factors of production B.) Equilibrium pricing C.) Import quotas D.) Brand loyalty