Consider two countries, Estonia and Ukraine. Estonia devotes a larger portion of its production to capital. All other things equal, which of the following statements is most likely true?
A. Ukraine is producing inside its production possibility frontier, whereas Estonia is producing at a point on its production possibility frontier.
B. Estonia will move up its production possibility curve faster than Ukraine.
C. Estonia's production possibility frontier will shift up and out farther and faster than Ukraine's.
D. Estonia is a poorer country than Ukraine.
Answer: C
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A monopolistically competitive firm and a monopoly are alike because both I. face downward sloping demand curves. II. have marginal revenue curves that lie beneath their demand curves. III. can make an economic profit in the long run
A) I only. B) I and II. C) I, II, and III. D) I and III.
Negative externalities impose most of their costs:
a. directly on consumers of polluting processes. b. whenever individual health is harmed in the production process. c. only in large cities. d. on individuals other than consumers of the polluting product.
Which of the following is most likely to be a major source of growth in per capita GDP?
a. A high investment / GDP ratio b. A high rate of inflation c. Rapid population growth d. Rapid growth in the money supply
The short-run Phillips curve shifts around because of changes in:
A. expectations of employment. B. expectations of inflation. C. the money supply. D. expectations of real income.