Which of the following would not be predicted by the Hecksher-Ohlin theorem?
a) the US should export capital-intensive and technology-intensive goods
b) India should export labor-intensive goods
c) Canada should have a comparative advantage in forestry
d) Kuwait should specialize in the production of oil
e) Central African Republic should have a comparative advantage in fisheries
e) Central African Republic should have a comparative advantage in fisheries
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If land is reallocated or switched from agricultural use to recreational use, then it is likely that
A) food is not as important as recreation. B) the demand for food is less today than in previous decades. C) land earns a higher rent in recreational use than in agricultural use. D) the demand curve for land in the agricultural industry is shifting to the right.
When the U.S. dollar rises in value relative to the Mexican peso, the dollar has ________, and when the dollar falls in value, it has ________
A) grown; shrunk B) grown; shrunken C) been bullish; been bearish D) depreciated; appreciated E) appreciated; depreciated
With a monetary growth rule as proposed by the monetarists, during a recession the rate of growth of the money supply would
A) not change. B) increase. C) decrease. D) decrease or increase depending on economic conditions.
Consider an Edgeworth economy where there are two citizens, Mr. Cortopassi and Ms. Thomas. There are only two goods to be consumed in the economy, Beer and Pretzels. The total amount of Beer is 12 units. The total amount of Pretzels is 12 units. Answer the following: Suppose Mr. Cortopassi has utility for the two goods characterized as U C (B,P) = B + P. Ms. Thomas's utility function is U T (B,P) = B + P. Identify the points that are Pareto efficient.
What will be an ideal response?