An improvement in the infrastructure of a country, ceteris paribus, should result in a lower price level and increased employment.
Answer the following statement true (T) or false (F)
True
An increase in the level of infrastructure will shift the AS to the right, lowering the price level and increasing output.
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"Rent seeking" describes the search and battle for opportunities to collect economic rents
a. True b. False Indicate whether the statement is true or false
Suppose the economy was in equilibrium, and the national government increased spending by $200 billion. Monetarist theory would predict that the nation's:
a. Real risk-free interest rate will rise causing real GDP to fall. b. Real risk-free interest rate will rise causing the monetary base, and therefore, the money supply to rise. c. Real risk-free interest rate will remain unchanged, but the money multiplier will rise. d. Real risk-free interest rate will fall causing real GDP to rise. e. Real risk-free interest rate will rise but real GDP will remain the same.
Then in terms of production,
Suppose Canada can produce either 120 units of goods, 80 units of services, or any linear combination thereof. Mexico can produce 90 units of goods, 50 units of services, or any linear combination thereof. a) Mexico has an absolute advantage in producing goods b) Canada should produce both goods and services, but mostly goods c) neither country should produce services d) the opportunity cost of producing goods is higher in Canada than in Mexico e) Mexico is relatively more efficient at producing services than goods