A country with a relatively low level of real GDP per person is considering adopting two policies to promote economic growth. The first is to decrease barriers to trade. The second is to restrict foreign portfolio investment. Which of these policies do most economists say promote growth?
a. both the first and the second
b. the first but not the second
c. the second but not the first
d. neither the first nor the second
b
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If private giving to public goods involves externalities, what is a Pigouvian solution to the public goods problem?
What will be an ideal response?
Suppose a typical worker in India can produce 32 units of product in an eight-hour day, while a typical worker in Bangladesh can produce 30 units of product in a 10-hour day. We can conclude that
a. worker productivity in Bangladesh is higher than in India. b. the standard of living will likely be higher in India than in Bangladesh. c. productivity is 4 units per hour for the worker in Bangladesh and 3 units per hour for the worker in India. d. there will be no difference between the standard of living in India and Bangladesh.
The short-run break-even price is the point at which
A) price is less than marginal cost. B) marginal cost, average total cost and marginal revenue are all equal. C) average variable cost is at a minimum. D) marginal cost, price and average variable cost are all equal.
A fall in labor costs will cause aggregate:
A. Supply to increase B. Demand to increase C. Supply to decrease D. Demand to decrease