What is an entrepreneur, and what decisions does an entrepreneur make in a market system?
What will be an ideal response?
An entrepreneur is someone who operates a business. In a market system, entrepreneurs decide what goods and services to produce and how to produce them.
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What are the three main exchange rate systems, and how do they operate?
What will be an ideal response?
The basic concept behind strategic trade policy is that free trade is the best policy to pursue, but some countries don’t play by those rules. Therefore,
A. it makes no sense to engage in trade at all, and it makes sense to be self-sufficient. B. it makes sense to restrict imports of items that are of military significance in order to maintain a strong defense posture. C. it makes sense to threaten to protect markets unless other nations agree to open theirs. D. it makes no sense to export items of strategic importance to other nations, because they should make them on their own.
Which of the following would NOT increase German exports to the United States?
A) an appreciation of the U.S. dollar B) a depreciation of the euro C) an appreciation of the euro D) an increase in German demand for U.S. exports
Suppose that at a bicycle shop, instead of having each worker assemble an entire bicycle themselves, one person welds the frames, another person works on the braking system, another person works on the tires, and another person works on the gears. This best demonstrates the concept of
A. comparative advantage. B. microeconomics. C. division of labor. D. absolute advantage.