Income generated by a nation's domestic production
a. is less than its domestic production.
b. is equal to its domestic production.
c. is greater than its domestic production.
d. could be less than, equal to, or greater than its domestic production.
b
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Refer to Table 2-11. If the two countries specialize and trade, who should export wheat?
A) South Korea B) There is no basis for trade between the two countries. C) China D) They should both be exporting wheat.
The present value of a promise to pay $100 one year from now would be greater if the interest rate were higher
a. True b. False
A trade deficit occurs when:
a. a country imposes a price floor on the good in which it has a comparative advantage. b. a country's imports exceed its exports. c. a country imposes a price ceiling on the good in which it has a comparative advantage. d. a country's exports exceed its imports. e. the domestic product market is in disequilibrium.
Suppose a perfectly competitive firm is producing 37 units output, and the marginal cost of the 37th unit is $3. If the firm can sell each unit of output for $5 and the firm's revenue is sufficient to cover its variable cost, the firm should:
A. decrease production. B. lower its price. C. raise its price. D. increase production.