All of the following are deficit items in the balance of payments EXCEPT
A. imports of merchandise.
B. purchases of foreign assets.
C. foreign tourist expenditures.
D. purchases of foreign currency.
Answer: C
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The investment schedule shows the
A. amounts business firms collectively intend to invest at each possible level of real GDP. B. positive relationship between the expected rate of return and the quantity of investment demanded. C. rate of interest that business firms must pay when they make investments in capital goods. D. inverse relationship between the expected rate of return and the quantity of investment demanded.
Suppose that the supply and demand of wheat depend on the price of wheat (p), the amount of annual rainfall (r), and the level of disposable consumer income (I)
The equations describing the supply and demand curves are given by: QS = 20r + 100p QD = 4000 - 100p + 10I Sketch a graph of the supply and demand curves for wheat and show the effects of an increase in the quantity of rainfall. How does each curve shift (if at all) from the increase in rainfall? What does this shift do to the equilibrium price and quantity (increase/decrease)?
Which one of the following is NOT a determinant of demand?
A) prices of related goods B) cost of inputs in production C) income D) future price expectations
Trade diversion reduces worldwide efficiency, because:
a. production is diverted to the country with comparative advantage. b. production is diverted away from the country with comparative advantage. c. unnecessary trade restrictions are created in the economies. d. consumption is diverted to the country having inadequate demand. e. the cost of transhipment of the goods increases thus raising their prices in the world market.