"The Balance of payments is always balances." Discuss
What will be an ideal response?
True. Every international transaction automatically enters the balance of payments twice, once as a credit and once as a debit.
Current account + financial account + capital account = 0
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Explain what will happen to the equilibrium real wage and quantity of labor for each of the following scenarios, and use a graph of the aggregate labor market to show the changes
a. The government decreases income tax rates. b. The skill level of workers increases. c. A hurricane destroys a large portion of the capital stock. d. Workers increase their preference of labor over leisure. e. A technological change occurs that increases the productivity of all workers, and at the same time the government increases income tax rates. f. The overall skill level of workers decreases, and at the same time household wealth increases.
Historians typically disagree with which of the following contentions from Time on the Cross?
(a) Slavery was profitable for Southerners and consequently resulted in wealth accumulation. (b) Slavery was on the verge of extinction on the eve of the Civil War. (c) Slave owners were moral and treated slaves with kindness and high standards. (d) Slave breeding and sexual exploitation were myths and slave sales rarely broke up slave families.
Suppose A and B are substitute goods. Other things being equal, the demand curve for A will shift to the right when the price of B goes down
a. True b. False Indicate whether the statement is true or false
In an oligopolistic market, if rival sellers act independently, each will have a strong incentive to
a. reduce price in order to increase sales and gain a larger share of the total market. b. increase price in order to get a larger share of the market and make larger profits. c. restrict output and raise price in order to achieve higher profits. d. maintain agreements to lower price and decrease product quality in order to earn higher profits.