Discuss the benefits of international trade and factors that lead to its growth.
What will be an ideal response?
Benefits of international trade include the ability of countries to exchange what they have and can produce at a comparative advantage for goods and services that they lack. International trade is good for businesses because it allows them to maximize their production resources and may lead to economies of scale. Increased competition in the global marketplace can help to keep prices down, which is good for consumers. In addition, consumers benefit from the increase in choices. Factors that contribute to international trade include improved transportation and communication, which makes it possible, for example, to grow food in one part of the world and deliver it for consumption in another.
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When the Fed unexpectedly decreases the money supply,
a. real interest rates will tend to decline. b. the exchange rate value of the dollar will tend to appreciate. c. aggregate demand will tend to increase. d. there is generally no impact on the economy.
Customer service representatives who have lost their jobs as a result of call centers being outsourced to India are an example of:
A. structural unemployment. B. cyclical unemployment. C. frictional unemployment. D. voluntary unemployment.
Which of the following is the best example of a quota?
A) a subsidy from the U.S. government to domestic manufacturers of residential air conditioners to enable them to compete more effectively with foreign producers B) a limit on the quantity of residential air conditioners that can be imported from a foreign country C) a $150 fee imposed on all imported residential air conditioners D) a tax placed on all residential air conditioners sold in the domestic market to help offset the impact of emissions on the environment
Which group is responsible for the policy decision of changing the money supply?
A. Federal Open Market Committee B. Office of Management and Budget C. Thrift Advisory Council D. Federal Advisory Council