The foreign exchange rate is the rate at which:
A. one country's currency can be traded for another country's currency.
B. taxes are imposed on foreign imports.
C. foreign goods are traded between domestic consumers.
D. immigrants are exchanged between countries.
Answer: A
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Refer to the Article Summary. All else equal, the lower production costs should help offset some of the falling income and
A) prevent losses from occurring in the agricultural sector. B) keep profits from falling to an even lower level. C) reduce the equilibrium quantity of agricultural output. D) keep prices from falling to an even lower level.
An upward-sloping trend line depicts long-run economic growth
Indicate whether the statement is true or false
If long-run average total cost decreases as the quantity of output increases, the firm is experiencing
a. economies of scale. b. diseconomies of scale. c. coordination problems arising from the large size of the firm. d. fixed costs greatly exceeding variable costs.
Suppose labor productivity in France is such that one hour of labor is required to produce one gallon of wine while two hours of labor are required to produce one pound of cheese. Assuming the availability of one million labor hours, draw a constant-cost production-possibility curve for France with the quantity of cheese measured along the vertical axis and the quantity of wine on the horizontal axis. If the free-trade price of wine is two pounds of cheese per gallon, show where, with free trade, France will produce on its production-possibilities curve. Then, draw and use a trade line to illustrate how France can gain from free trade.
What will be an ideal response?