Which of the following helps low-income countries grow rapidly relative to high-income countries?
A. Low-income countries are in a better position to save a larger share of their income.
B. Low-income countries can employ technologies and practices that have been successful in high-income countries.
C. Low-income countries generally have legal systems that protect property rights and enforce contracts in a more evenhanded manner.
D. Low-income countries generally have more favorable weather conditions.
Answer: B
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By and large, small countries tend to benefit the most from international trade because
a. their citizens tend to be the most different from the rest of the world. b. they are unable to achieve self-sufficiency. c. they can collect large amounts of tariff revenue from trading with larger countries. d. their citizens are more likely to prefer the high-quality, capital-intensive goods available only from larger countries.
If the population and labor base of Laurent’s country increases by 2 percent every year, how will this affect the production possibilities curve?
a. The curve will be rendered obsolete.
b. The curve will be shifted outward.
c. The curve will be shifted downward.
d. The curve will be unaffected.
Consumption spending is $16 million, planned investment spending is $4 million, unplanned investment spending is $2 million, government purchases are $6 million, and net export spending is $1 million. What is aggregate expenditure?
What will be an ideal response?
A decrease in firm 1's marginal cost will cause:
A. an upward shift in firm 2's reaction function, resulting in a new Cournot equilibrium where firm 1 is producing a lower quantity and firm 2 is producing a higher quantity. B. a downward shift in firm 2's reaction function, resulting in a new Cournot equilibrium where firm 1 is producing a higher quantity and firm 2 is producing a lower quantity. C. a downward shift in firm 1's reaction function, resulting in a new Cournot equilibrium where firm 1 is producing a lower quantity and firm 2 is producing a higher quantity. D. an upward shift in firm 1's reaction function, resulting in a new Cournot equilibrium where firm 1 is producing a higher quantity and firm 2 is producing a lower quantity.