Countries can expect to gain from international trade as long as they:
A. use trade restrictions to reduce competition for domestic producers.
B. keep production diversified.
C. specialize according to their comparative advantage.
D. produce only those goods for which they have a relatively high opportunity cost.
Answer: C
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Define the following terms. Give a complete and precise definition in one sentence. a. total utility b. marginal utility c. consumer’s surplus d. “law” of demand
What will be an ideal response?
Suppose the money supply grew at an average annual rate of 8%, velocity was constant, the nominal interest rate averaged 9%, and output grew at an average annual rate of 3%. According to the quantity theory,
a. inflation averaged 8% per year and the real interest rate was 9%. b. inflation averaged 11% per year and the real interest rate was 17%. c. inflation averaged 5% per year and the real interest rate was 4%. d. inflation averaged 1% per year and the real interest rate was 6%.
Which of the following will most likely reduce the natural rate of unemployment?
a. an increase in the minimum wage b. an increase in unemployment benefits c. an increase in the proportion of prime-age workers (35-54) as a share of the labor force d. an increase in the labor force participation rate of teenagers
Assume that foreign capital flows into a nation rise due to expected increases in stock market appreciation. If the nation has highly mobile international capital markets and a fixed exchange rate system, what happens to the quantity of real loanable funds per time period and GDP Price Index in the context of the Three-Sector-Model? a. The quantity of real loanable funds per time period rises
and GDP Price Index rises. b. The quantity of real loanable funds per time period falls and GDP Price Index falls. c. The quantity of real loanable funds per time period rises and GDP Price Index falls. d. The quantity of real loanable funds per time period and GDP Price Index remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.