Without an increase in the supply of the factors of production, how can a nation achieve economic growth?
A) by producing more high-value goods and fewer low-value goods
B) through technological advancement which enables more output with the same quantity of resources
C) by lowering the prices of factors of production
D) by increasing the prices of factors of production
Answer: B
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In Poland’s free market, Felix Siemienas is making a fortune in cold cuts. Prices are much higher than formerly. Siemienas says, “Yes, my prices are high. If nobody buys, I bring my prices down. That is the market rule.” This “rule” best describes
A. the law of diminishing returns. B. opportunity cost. C. the law of increasing costs. D. the law of demand.
Which of the following is most likely to be predicted by the Heckscher-Ohlin theory?
A. The wage rate of the low-skilled workers will be higher in the developing countries than in the developed countries. B. The industrialized nations will mainly export labor-intensive goods. C. Countries like China will completely specialize in the production of primary products. D. The developing countries will mainly export labor-intensive goods.
Which of the following is true?
a. Monetary policy influences long-term real interest rates more than short-term interest rates. b. Short-term interest rates are primarily determined by real factors and the expected inflation. c. A shift to a more expansionary monetary policy will tend to raise short-term interest rates. d. A shift to expansionary monetary policy that increases the fear of future inflation will tend to increase long-term interest rates.
When the Fed purchases more bonds and, thereby, increases the money supply, the initial effects of the more expansionary monetary policy will often be weakened as a result of
a. lower nominal interest rates and a decline in the velocity of money. b. higher nominal interest rates and a decline in the velocity of money. c. higher nominal interest rates and an increase in the velocity of money. d. lower real interest rates and an increase in the velocity of money.