If capital is specific to manufacturing and land is specific to agriculture, then migration of labor from lowincome to highincome countries will cause:
a. the wage to rise in the highincome country and the wage to fall in the lowincome country.
b. the wage to fall in the highincome country and the wage to rise in the lowincome country.
c. the wage to rise in both the highincome and low income countries.
d. the wage to fall in both the highincome and low income countries.
Ans: b. the wage to fall in the highincome country and the wage to rise in the lowincome country.
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a. embrace the Bretton Woods system b. argue that flexible rates do not cause inflation c. prefer government control of exchange rates d. believe they can cause currency shortages
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Answer the following statement true (T) or false (F)
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A. Real GDP increases, and the price level remains constant. B. The price level increases, and real GDP remains constant. C. Real GDP decreases, and the price level remains constant. D. The price level decreases, and real GDP remains constant.