In order to obtain an efficient allocation of resources worldwide
A) countries that have a lot of resources should ship resources to countries that do not have a lot of resources.
B) countries that have a lot of resources should not trade since poorer countries cannot compete.
C) each country should produce the good they have a comparative advantage in and then trade.
D) no trade among countries should occur.
Answer: C
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Capital goods are
A. long-lived goods used for producing other goods and services. B. excluded from GDP. C. the end products of production. D. publicly provided.
When the aggregate demand curve shifts,
A) the inflation rate does not change. B) there is a movement along the short-run Phillips curve. C) there is a change in potential GDP. D) there is a change in the natural unemployment rate. E) the short-run Phillips curve shifts.
Because of transactions which take place in the underground economy, the:
a. GDP calculation tends to overstate the actual value of goods sold in the economy. b. GDP calculation tends to accurately portray the value of goods sold in the economy. c. GDP calculation tends to understate the actual value of goods sold in the economy. d. value of the GDP calculation will be equal to the value of the national income calculation. e. value of the GDP calculation through the expenditure approach will be greater then the value calculated through the income approach.
Externalities tend to cause markets to be
a. inefficient. b. unequal. c. unnecessary. d. overwhelmed.