International trade is most likely to occur whenever
a. one of the trading nations is self-sufficient
b. all of the trading nations are self-sufficient
c. one of the trading nations gains from trade
d. each of the trading nations gains from trade
e. labor is cheaper abroad
D
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The purpose of expansionary monetary policy is to increase ________.
A. real GDP B. the GDP gap C. interest rates D. the inflation rate
If the marginal propensity to consume was 0.75, it would mean that:
A. $0.75 of an additional $1 of individuals' after-tax income is spent on consumption. B. $0.75 of an additional $1 of individuals' after-tax income is saved. C. $0.25 of an additional $1 of individuals' after-tax income is spent on consumption. D. None of these is true.
The name of the rate that equalizes the prices of internationally traded goods between countries is called the
a. international interest rate. b. arbitrage rate. c. purchasing power parity rate. d. foreign exchange rate.
Contractionary monetary policy
a. leads to disinflation and makes the short-run Phillips curve shift right. b. leads to disinflation and makes the short-run Phillips curve shift left. c. does not lead to disinflation but makes the short-run Phillips curve shift right. d. does not lead to disinflation but makes the short-run Phillips curve shift left.