The balance of payments records transactions between:
(a) Households and firms in a particular country.
(b) Residents of one country and the rest of the country.
(c) Residents of one country and the rest of the world.
(d) Between residents of all EU countries only.
Answer: (c) Residents of one country and the rest of the world.
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The adverse selection process is prevalent in the used car market because
a. only poorer people are likely to purchase used cars. b. sellers know more about the vehicles being sold than do potential buyers. c. the price of the car sends a signal about its quality. d. so many consumers are adverse to buying used cars.
Developing countries often justify imposition of tariffs because:
a. it creates a burden on government budget. b. it is easy to collect direct taxes from people in the developing countries. c. a large number of people in the developing countries earn a taxable income. d. developing countries find income taxes difficult to levy and collect. e. the volume of imports of these countries is considerably low.
A decrease in the price of a product and an increase in the number of buyers in the market affect the demand curve in the same general way
a. True b. False Indicate whether the statement is true or false
Answer the question on the basis of the following data. All figures are in billions of dollars. Proprietor's Income 20 Compensation of Employees 300 Consumption of Fixed Capital 15 Gross Investment 80 Rents 10 Interests 20 Exports 30 Imports 50 Corporate Profits 25 Taxes on Production and Imports 5 Net Foreign Factor Income 0 Statistical Discrepancy 0 Refer to the above data. National income is:
a) $395. b) $380. c) $375. d) $360.