Refer to the information provided in Figure 20.3 below to answer the question(s) that follow.
Figure 20.3Refer to Figure 20.3. The domestic price of shoes is $80. After trade the price of a pair of shoes is $60. If shoes are a normal good and income in this country rises, then we would expect
A. the number of pairs of shoes exported from this country to decrease.
B. the number of pairs of shoes imported into this country to decrease.
C. the number of pairs of shoes imported into this country to increase.
D. the number of pairs of shoes exported from this country to increase.
Answer: C
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Which of the following transactions would be included in Japan's current account?
A) A Japanese citizen purchases 50 shares of Google stock. B) An American citizen purchases a new Toyota made in Japan. C) A Japanese citizen purchases a new Toyota made in Japan. D) An American citizen purchases 50 shares of Toshiba stock.
Oil prices increased significantly in 2008. According to the Keynesian model, this increase in oil prices should have caused which of the following to occur?
A) demand-pull inflation B) demand-push inflation C) cost-push inflation D) cost-pull inflation
Figure 10-6
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In Figure 10-6, if the current market price is at $10, then in the long-run equilibrium
A. each firm will be producing a smaller output. B. the market price will rise to $20. C. the number of firms in the market will increase. D. All of these responses are correct.
The Laffer curve indicates which of the following?
A. There is an ideal tax-revenue-maximizing tax rate for government taxes. B. There is an ideal interest rate that will maximize investment spending. C. There is an ideal income tax rate on individuals, depending on their consumption behavior. D. There is an ideal amount of government spending that will lead to full national employment.