The use of money allows trade to be roundabout
a. True
b. False
Indicate whether the statement is true or false
True
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Refer to Figure 3-8. The graph in this figure illustrates an initial competitive equilibrium in the market for apples at the intersection of D1 and S1 (point A)
If there is an increase in the wages of apple workers and an increase in the price of oranges, a substitute for apples, the equilibrium could move to which point? A) none of the points shown B) B C) C D) E
Other things the same, as the real interest rate falls
a. domestic investment and net capital outflow both rise. b. domestic investment and net capital outflow both fall. c. domestic investment rises and net capital outflow falls. d. domestic investment falls and net capital outflow rises.
Assume Saudi Arabia can produce 4 units of good X or 3 units of good Y. Tunisia can produce 5 units of good X or 8 units of good Y. What would be the terms of trade between Saudi Arabia and Tunisia for 1 unit of good Y?
A. Between 5/8 and 4/3 units of X. B. Between 4 and 8 units of X. C. Between 3 and 5 units of X. D. Between 3/4 and 8/5 units of X.
Consider a fall in the wage rate. How does the substitution effect change the amount of labor that a firm hires? How does the scale effect change the amount of labor that a firm hires? What do these effects imply about the firm's long-run demand for labor?
What will be an ideal response?