The following are obstacles to international investment EXCEPT
A. adverse selection.
B. asymmetric information.
C. moral hazard.
D. rational expectations.
Answer: D
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An important critique of real business cycle theory is the belief that cyclical movements in total factor productivity
A) rarely occur. B) may, in part, be an artifact of measurement error. C) lead to imperceptible changes in labor demand. D) are too small to account for the size of fluctuations in real GDP.
The user cost of an exhaustible resource is
A) the same as its price. B) the same as its production cost. C) the opportunity cost of using the resource today rather than saving it for the future. D) the amount of the resource that is extracted today. E) not related to the amount of the resource that exists.
Human capital consists of the skills and knowledge that workers possess
a. True b. False
Consider an economy in which all labor markets are perfectly competitive, all workers are equally able to do any job, and the nonwage attributes of all jobs are equally attractive to all workers. Which of the following would occur in a labor market where the current wage rate exceeds wage rates in alternate markets?
a. Labor demand will decrease, and the equilibrium wage rate will fall. b. Labor demand will increase, and the equilibrium wage rate will fall. c. Labor demand will increase, and the equilibrium wage rate will rise. d. Labor supply will decrease, and the equilibrium wage rate will rise. e. Labor supply will increase, and the equilibrium wage rate will fall.