Intraindustry trade refers to
A) international trade in products made within the same industry.
B) international trade in products made across different industries.
C) trade that occurs as a result of comparative advantage.
D) the exchange of dissimilar items.
A
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When there are many producers of an identical product and you have perfect and free information about what every seller is charging, eventually every merchant will
A) raise the price of the product in hopes that you will purchase the product from them. B) agree to charge a high price for the product so each will be able to earn high profits. C) charge the same price for the product, and the price will be just enough to cover costs. D) discontinue selling the product since there is so much competition.
Suppose a negative technological change in the production of disease-resistant wheat caused the price of wheat to rise. Holding everything else constant, how would this affect the market for corn (a substitute for wheat)?
A) The supply of corn would decrease and the equilibrium price of corn would increase. B) The demand for corn would increase and the equilibrium price of corn would increase. C) The demand for corn would increase and the equilibrium price of corn would decrease. D) The demand for corn would decrease because consumers could afford to buy less wheat and corn.
The demand for a product at a given time is defined as the
a. desire for it. b. sum spent on it. c. measure of total utility for it. d. amount that would be bought at various prices.
Assume a simplified banking system subject to a 25 percent required reserve ratio. If there is an initial increase in excess reserves of $100,000 . the money supply:
a. increases $100,000 b. increases $400,000. c. increases $125,000 d. decreases $500,000.