The Stolper-Samuelson theorem predicts that free trade between the United States, a capital-abundant country, and Mexico, a labor-abundant country, would ultimately result in
A. lower wages in both countries.
B. lower wages in Mexico and higher wages in the United States.
C. higher wages in Mexico and lower wages in the United States.
D. higher wages in both countries.
Answer: C
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Compared to the United States, minimum wages are ________ and unemployment benefits ________ in Western Europe.
A. lower; less generous B. higher; less generous C. higher; more generous D. lower; more generous
In terms of manpower needed to fight the Civil War, the South was disadvantaged by
a. a smaller total population of military-aged males than the North. b. limited support from free, white males in border states. c. a population that included over 1 million military-aged slaves who could not be used for direct combat. d. the fact that some of its manpower had to be used to repress the slave labor force. e. All of the above.
It is common knowledge that many U.S. national parks have become overused. One possible solution to this problem is to
a. increase entrance fees. b. increase advertising for the national parks. c. reduce the national park service budget. d. subsidize park admissions. e. all of these are possible solutions.
Prices below the free market equilibrium price are inefficient because:
A. they prevent mutually beneficial transactions. B. no one can be made better off without hurting someone by participating in another transaction. C. all mutually beneficial transactions happen. D. more goods could be produced using society's resources.