Countries with low wages will always be able to export to countries with high wages
Indicate whether the statement is true or false
FALSE
Explanation: Low wages might be too high relative to differences in labor productivity.
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Starting from long-run equilibrium, a large tax increase will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. recessionary; lower; potential B. expansionary; lower; potential C. expansionary; higher; potential D. recessionary; lower; lower
Which of the following is the best example of specialization in the economic sense??
a. A factory produces goods using high-tech equipment. b. A factory focuses production on one type of good. c. A factory gives workers access to many types of training. d. A factory cross-trains workers to perform a range of tasks.
The increase in income in response to a fiscal expansion in the IS-LM is:
What will be an ideal response?
The ability to produce an item at a lower opportunity cost compared with other producers is known as
A. competitive dominance. B. comparative advantage. C. productive dominance. D. absolute advantage.