During 2007, the United States and Japan announced possible limits on Chinese imports through higher tariffs on Chinese products. To avoid these limits, China would have had to:
A. decrease the value of the yuan and increase its trade surplus.
B. increase the value of the yuan and increase its trade surplus.
C. decrease the value of the yuan and decrease its trade surplus.
D. increase the value of the yuan and decrease its trade surplus.
Answer: D
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Starting from long-run equilibrium, a large increase in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; potential B. recessionary; higher; potential C. recessionary; lower; lower D. expansionary; higher; higher
If two goods, J and K, are complements, then which of the following statements is FALSE?
A) They are consumed together. B) An increase in the price of J causes the demand for K to rise. C) When the quantity demanded of J increases, the demand for K increases. D) A decrease in the price of K causes an increase in the demand for J.
What is marginal analysis?
A shortage will occur if:
A. the quantity being supplied at a given price exceeds the quantity demanded at that price. B. the quantity being supplied at a given price is less than the quantity demanded at that price. C. there are not enough buyers in the market. D. there are only inexperienced firms in the market.