What economic framework can inform the debate on immigration?
What will be an ideal response?
Economists consider the marginal benefit and marginal cost of immigration. If the marginal costs of immigration are greater than the marginal benefits for a nation, then fewer immigrants should be admitted to a nation. If the marginal benefits of immigration for a nation are greater than the marginal costs, then more immigrants should be admitted. This economic framework also recognizes that not all immigrants are the same from a cost and benefit perspective. Some immigrants with better education and skills bring more benefits to a nation whereas as unskilled and uneducated immigrants can impose a higher cost.
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The self-correcting tendency of the economy means that rising inflation eventually eliminates:
A. unemployment. B. exogenous spending. C. recessionary gaps. D. expansionary gaps.
The increase in the demand for widgets, shown in the figure above, is the result of an increase in the price of McBoover devices from $9 to $11. Therefore, the cross-price elasticity for these two products is
A) -2.0. B) -0.5. C) 0.5. D) 2.0.
Adjusting monetary growth based on previous changes in nominal GDP
A) is relatively easy for the Fed to undertake because the implementation lag is quitelong. B) could be destabilizing because of the uncertainty of the length of impact lags. C) is an effective policy because it allows the Fed to influence future macroeconomic performance. D) raises the price level proportionately.
A reduction in the rate of inflation would be
A. deflation. B. hyperinflation. C. disinflation. D. crawling inflation.