In one week, Mohammed can knit 5 sweaters or bake 240 cookies. In one week, Tetah can knit 15 sweaters or bake 480 cookies. In this example,
a. Mohammed has the absolute and comparative advantage in both tasks
b. Tetah has the absolute and comparative advantage in both tasks
c. Mohammed has the absolute advantage in both tasks and the comparative advantage in knitting sweaters
d. Tetah has the absolute advantage in both tasks and the comparative advantage in knitting sweaters
e. Mohammed has the absolute advantage in both tasks and the comparative advantage in baking cookies
D
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The efficient markets hypothesis implies that stock investments should have the same expected return after adjusting for
A) risk. B) information costs. C) liquidity. D) all of the above.
In 1990, which Latin American countries saw inflation climb above 2,000%?
a. Colombia and Venezuela b. Mexico and Guatemala c. Brazil and Argentina d. Uruguay and Paraguay
Suppose the economy starts off producing Natural Real GDP. Next, aggregate supply rises, ceteris paribus. As a result, the price level falls in the short run. In the long run, when the economy has moved back to producing Natural Real GDP, the price level will be
A) higher than it was in short-run equilibrium. B) lower than it was in short-run equilibrium but higher than it was originally (before aggregate supply rose). C) lower than it was originally (before aggregate supply rose). D) equal to what it was originally (before aggregate supply rose).
Which of the following is not a reason the aggregate-demand curve slopes downward? As the price level increases,
a. firms may believe the relative price of their output has risen. b. real wealth declines. c. the interest rate increases. d. the exchange rate increases.