"Trade restrictions such as tariffs and quotas are like a blockade that a nation imposes on its own people." Is this statement true?
What will be an ideal response?
Yes, both the trade restrictions and a blockade will reduce the gains from specialization and trade.
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Labor unions: a. have no influence over wages
b. can influence wages by restricting labor supply. c. are illegal in the United States. d. have significantly increased their membership in the last two decades.
Assume that the central bank increases the reserve requirement. If the nation has highly mobile international capital markets and a flexible exchange rate system, what happens to the GDP Price Index and the nominal value of the domestic currency in the context of the Three-Sector-Model?
a. The GDP Price Index falls, and nominal value of the domestic currency falls. b. The GDP Price Index falls, and nominal value of the domestic currency remains the same. c. There is not enough information to determine what happens to these two macroeconomic variables. d. The GDP Price Index rises, and nominal value of the domestic currency rises. e. The GDP Price Index falls, and nominal value of the domestic currency rises.
A monopoly produces X at a marginal cost of $10 per unit and charges a price of $20 per unit. Determine the elasticity of demand at the profit-maximizing price of $20.
A. ?2 B. ?0.5 C. ?0.333 D. There is insufficient information to determine the monopoly's price elasticity of demand.
Upon graduation, Shawntae had two job offers. The jobs were identical in every way with two exceptions. One job was located in Ft. Lauderdale, FL and offered an annual salary of $95,000. The other job was located in Tulsa, OK and offered an annual salary of $72,000. All else equal, the salary difference is due to
A. compensating differentials. B. discrimination. C. the firm in Florida had a lower demand for workers than the firm in Oklahoma. D. transfer payments