If a country allows trade and, for a certain good, the domestic price without trade is higher than the world price,
a. the country will be an exporter of the good.
b. the country will be an importer of the good.
c. the country will be neither an exporter nor an importer of the good.
d. Additional information is needed about demand to determine whether the country will be an exporter of the good, an importer of the good, or neither.
B
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If velocity does not change and the quantity of money grows at the same rate as does real GDP, then in the long run
A) the real interest rate is less than the nominal interest rate. B) the inflation rate equals zero. C) the nominal interest rate equals zero. D) the inflation rate equals the growth rate of the quantity of money. E) the nominal interest rate is less than the real interest rate.
At $5 per cup, customers will buy 8 cups of coffee per week. At a price of $3, consumers are willing to buy 12 cups per week. The elasticity of the market demand curve for coffee between P = $5 and P = $3 (dropping all minus signs) is
A. 0.40. B. 1.0 C. 1.25. D. 0.80.
Increases in investment spending cause interest rates to increase. As a result,
a. households will demand more loanable funds b. households will save a smaller fraction of their incomes c. households will voluntarily decrease their consumption spending d. the investment curve will shift leftward e. firm will receive greater profits from households who are consuming goods
What percentage of the world population lives in low-income countries?
a. 10 percent b. 11.8 percent c. 15 percent d. 20 percent