Adam Smith's insight was that prices adjust to guide individual buyers and sellers to reach outcomes where, in many cases,
a. opportunity cost is minimized for buyers.
b. scarcity is reduced for society.
c. well-being of society is maximized.
d. opportunity cost of production is maximized.
c
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In 2012, consumers in Dexter consumed only books and pens. The prices and quantities for 2012 and 2013 are listed in the table above. The reference base period for Dexter's CPI is 2012. What is the inflation rate in 2013?
A) 69 percent B) zero C) 31 percent D) 2 percent
Domestic currency appreciation will:
A) help domestic firms that export and hurt domestic firms that import. B) hurt domestic firms that import. C) hurt domestic firms that export and help domestic firms that import. D) help domestic firms that export.
Consider a small open economy with desired national saving of Sd = 1000 + 1000rw and desired investment of Id = 1000 - 500rw. Calculate national saving, investment, and the current account balance in equilibrium when the real world interest rate is
(a) rw = 0.025. (b) rw = 0.05. (c) rw = 0.0.
Which of the following is NOT an issues in the reduction of trade protection in agriculture?
A) consumption subsidies. B) tariffs and quotas. C) export subsidies. D) production subsidies.