If Brazil can produce 5 shirts or 4 pounds of beef in a day, and Uruguay can produce 10 shirts or 2 pounds of beef in a day, then Brazil has a comparative advantage in the production of beef
a. True
b. False
Indicate whether the statement is true or false
True
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To stay with a fixed exchange rate system, a nation that is losing most of its international reserves will have no choice but to
A) ask for or declare a devaluation. B) ask for or declare a revaluation. C) let its currency depreciate. D) let its currency appreciate.
Suppose two goods are perfect substitutes. The price elasticity of demand of one of the goods is
A) 0. B) 1. C) 1000. D) infinity.
Utility is:
a. easily measured, because all people derive the same utility from consumption. b. easily measured, because it is an objective concept. c. easily measured, because it is a subjective concept. d. hard to measure, because it is a subjective concept. e. hard to measure, because it is an objective concept.
When household debt as a share of income is abnormally high,
a. rapid growth of consumption is likely to lead the recovery. b. the growth prospects of the economy will be excellent because high household debt is the key to a strong economy. c. the growth of consumption is likely to remain sluggish even as the economy begins to recover. d. consumers will be in a strong position to deal with irregular expenses.