Brazil is able to produce 10 cars and 5 computers in one hour while India is able to produce 1 car and 4 computers in one hour. Brazil has a comparative advantage in producing _____________, and India has a comparative advantage in producing ________.
a) cars; cars
b) computers; cars
c) cars; computers
d) computers; computers
c) cars; computers
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Which of the following is likely to happen if the Fed conducts a contractionary monetary policy?
A) Labor demand will increase. B) The nominal interest rate will decrease. C) The stock of money in the economy will decrease. D) Banks will make more loans.
If there are five firms in an industry, each with a market share of 20 percent, the Herfindahl-Hirschman Index (HHI) of concentration is
A) 2000. B) 400. C) 100. D) 20.
In the principal-agent problem, the agent is:
A. a person who entrusts someone with a task. B. a person who carries out a task on someone else's behalf. C. a person who is in charge of a top-secret mission. D. a person who has the same objectives as the principal.
Which of the following is an intermediate target of the Fed's policies?
a. Exchange rate b. Unemployment c. Money supply d. Interest rate e. Inflation