Which situation would most likely cause a nation's production possibilities curve to shift inward?
A. An increase in unemployment
B. An increase in the amount of imports
C. An increase in the number of skilled immigrant workers
D. The destruction caused by bombing and warfare in a losing military conflict
Answer: D
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Consider two types of rules that might govern an otherwise unregulated health insurance market: (1) Insurance companies can price-discriminate against the sick and old; (2) insurance companies cannot price discriminate against the sick and old. Explain why, in equilibrium, insurance may be very expensive for the sick and old regardless of which case we find ourselves in.
What will be an ideal response?
In recent cases, the U.S. placed quotas or protectionist tariffs on imported steel and imported microchips. In both cases the damage to "downstream" industries was obvious to all and relatively easy to quantify and demonstrate. Assuming that the
lawmakers are not plain dumb, why did they enact these protectionist policies?
A monopoly will usually produce
A) where its demand curve is inelastic. B) where its demand curve is elastic. C) where its demand curve is either elastic or inelastic. D) only when its demand curve is perfectly inelastic.
In the aggregate expenditures model, if aggregate expenditures (AE) equals $7 trillion and GDP equals $8 trillion, then inventory accumulation equals $1 trillion
a. True b. False Indicate whether the statement is true or false