Several studies have shown promising links between green tea consumption and cancer prevention. How does this affect the market for green tea?
A) The quantity of green tea demanded decreases because this new information will increase the price of green tea.
B) The green tea demand curve shifts to the right because of a change in tastes in favor of green tea.
C) The green tea demand curve shifts to the left because this new information will increase the price of green tea.
D) The quantity of green tea demanded increases because of a change in tastes in favor of green tea.
B
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Which of the following statements correctly highlights a difference between countries with extractive economic institutions and countries with inclusive economic institutions?
A) Countries with extractive economic institutions typically have better geographical conditions that countries with inclusive economic institutions. B) Countries with extractive economic institutions typically have worse geographical conditions that countries with inclusive economic institutions. C) Entry barriers for new businesses are likely to be lower in countries with extractive economic institutions than in countries with inclusive economic institutions. D) Entry barriers for new businesses are likely to be higher in countries with extractive economic institutions than in countries with inclusive economic institutions.
For a major country with extensive capital flows, what is the effect of a decrease in interest rates?
a. There will be an inflow of capital, a currency depreciation, and increased net exports. b. There will be an inflow of capital, a currency depreciation, and reduced net exports. c. There will be an outflow of capital, a currency depreciation, and increased net exports. d. There will be an inflow of capital, a currency appreciation, and reduced net exports.
The theory of purchasing-power parity primarily explains
a. why trade deficits tend to move to zero over time. b. how foreign prices affect domestic prices. c. the determination of the real exchange rate. d. why a change in the real exchange rate changes a country's net exports.
Which of the following is likely to occur if OPEC increases the amount of oil it supplies and domestic energy prices fall, ceteris paribus?
A. Aggregate supply will decrease or shift to the left. B. Aggregate supply will increase or shift to the right. C. Aggregate demand will increase or shift to the right. D. Aggregate demand will decrease or shift to the left.