Which of the following statements is(are) FALSE?
I. Trade creation is always bad for countries.
II. Trade diversion is always good for countries.
III. Regional trade agreements never cause welfare losses.
a. I
b. II
c. III
d. I, II, and III
Ans: d. I, II, and III
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a. the cross elasticity is 0.4. b. these goods are substitutes. c. the price elasticity of demand for California oranges is 0.4. d. these goods are complements.
What is the price of a unit of labor in a competitive labor market?
What will be an ideal response?
Refer to Table 22-5. Consider the statistics in the table above in describing the industrialized countries. Are these consistent with the economic growth model? Briefly explain
What will be an ideal response?
In the basic Keynesian model, a tax cut:
A. reduces short-run equilibrium output. B. reduces potential output. C. increases short-run equilibrium output. D. increases potential output.