According to the theory of international trade, a nation should
A. always export goods in which it has a comparative advantage.
B. always import goods in which it has an absolute advantage.
C. always export goods in which it has an absolute advantage.
D. always import goods in which it has a comparative advantage.
A. always export goods in which it has a comparative advantage.
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When there is a recessionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; decline B. increase; raise; decline C. decline; lower; expand D. decline; raise; decline
China, the last large communist society,
A. has proved that a command economy has far less pollution problems than capitalist economies. B. has urban smog levels higher than Los Angeles. C. has the world’s most sophisticated pollution-control devices. D. has lowered its level of pollution dramatically since 1980.
A proprietorship or partnership can raise funds for expansion in all of the following ways except
A) borrowing from someone or an institution willing to lend the funds. B) taking on a partner or more partners. C) issuing stock through financial markets. D) reinvesting profit back into the business.
Suppose that a new drug has been approved to treat a life-threatening disease. The demand for that drug is shown on the accompanying graph. Prior to approval of this drug, the only treatment for this condition was any one of several non-prescription, or over-the-counter, pain relievers. The demand for one brand of the several non-prescription pain relievers is also shown on the graph.
A likely reason for the difference in the slopes of the demand curves is that:
A. one drug is heavily regulated by the Food and Drug Administration and the other is not. B. one market is in equilibrium and the other is not. C. one drug is new on the market, but the other has been available for a long time. D. the over-the-counter pain reliever has many substitutes, but the new drug does not.