How are the patterns of international trade, that is the pattern of what different countries export and import, explained?
What will be an ideal response?
Climate explains why Brazil exports coffee. Natural resources explain why Saudi Arabia exports oil. More generally, differences in labor productivity and in the availability of land, labor, and capital within different countries explain patterns of trade. More recent research suggests that there is a significant random component involved, as well.
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Suppose the price of coffee is $3, the price of a bagel is $2 and a person's budget is $40. The budget line's equation is
A) $2/Qbagel + $3/Qcoffee = $40. B) $2(Qbagel) + $3(Qcoffee) = $40. C) Qbagel /$2 + Qcoffee /$3 = $40. D) Qbagel + Qcoffee = $40/($3 + $2).
Marx's point that under capitalism workers are divorced from capital is:
a. How socialism extracts surplus value b. Dialectical materialism c. Imperialism d. Primitive capitalist accumulation e. All of the above
Suppose an economy only produces two goods, robots and ice cream. Last month, the economy produced 10 robots and 200 gallons of ice cream. This month, the same economy produced 15 robots and 240 gallons of ice cream. Which of the following statements could explain this change?
a. This month, the economy reduced the unemployment of its resources. b. This month, the economy experienced an improvement in technology. c. This month, the economy experienced an increase in resources d. All of the above are correct.
A country's current account includes which of the following?
a. sales of assets to other countries b. purchases of assets from other countries c. all current automatic payments between countries d. the country's trade balance e. the balance available in the government's Treasury account