In 2004, retailers and exporters in the United States were happy, as were their customers from abroad, due to:
a. a reduction in import tariffs by the EU.
b. the lifting of an embargo on U.S. exports to Germany.
c. the high value of the U.S. dollar compared to other currencies.
d. the low value of the U.S. dollar compared to other currencies.
Ans: d. the low value of the U.S. dollar compared to other currencies.
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A trade surplus occurs when a country:
A. imports more than it exports. B. imports less than it exports. C. has a negative balance of trade. D. has a zero balance of trade.
The multiplier effect states that there are additional shifts in aggregate demand from fiscal policy, because it
a. reduces investment and thereby increases consumer spending. b. increases the money supply and thereby reduces interest rates. c. increases income and thereby increases consumer spending. d. decreases income and thereby increases consumer spending.
"The invisible hand" is really the ____________.
Fill in the blank(s) with the appropriate word(s).
"Consumer sovereignty" refers to the:
A. fact that resource prices are higher than product prices in capitalistic economies. B. idea that the pursuit of self-interest is in the public interest. C. idea that the decisions of producers must ultimately conform to consumer demands. D. fact that a federal agency exists to protect consumers from harmful and defective products.