All of the points on a budget line result in combination of goods that expend all of her income.
Answer the following statement true (T) or false (F)
True
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If all the countries used one common currency, we could expect that exports and imports would
a. decrease because international trade would be less needed b. decrease because each country would be producing more output c. increase because exchange rate uncertainty would be eliminated d. increase because many small countries would benefit most e. not change because trading of goods is independent of currency
The presence of large sunk costs often serves as a naturally imposed barrier to entry
a. True b. False Indicate whether the statement is true or false
If the price of hairbrushes decreases by 20 percent, the quantity demanded increases by 2 percent. The price elasticity of demand is:
A. -0.1 and is inelastic. B. 10 and is elastic. C. 10 and is inelastic. D. -0.1, and is elastic.
The multiplier applies to:
A. investment but not to net exports or government spending. B. investment, net exports, and government spending. C. increases in spending but not to decreases in spending. D. spending by the private sector but not by the public sector.