Suppose that land is specific to agriculture, capital is specific to manufacturing, and labor is mobile between sectors. According to the specificfactors model, if this country begins importing manufactured goods, which factor will experience the highest unemployment?
a. Labor
b. Capital
c. Land
d. No factors will experience unemployment.
Ans: d. No factors will experience unemployment.
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One drawback to a single currency is that
A) the exchange rate is more volatile. B) bond markets are larger and therefore harder to control. C) exporters and importers have fewer choices about how they will receive and make payments. D) individual nations cannot use monetary policy to stabilize the economy. E) foreign currency is more expensive.
In 1791, what percentage of America's clothing was homemade?
a. 10%–20% b. 30%–40% c. 60%–80% d. 95% or more
Changes in the GDP deflator reflect only changes in the prices of goods and services
a. True b. False Indicate whether the statement is true or false
Using Figure 1 above, if the aggregate demand curve shifts from AD3 to AD2 the result in the short run would be:
A. P3 and Y1. B. P2 and Y1. C. P2 and Y3. D. P1 and Y2.