Which of the following best expresses the benefit from international trade?
a. With trade, each country can concentrate on producing those goods and services that it produces most efficiently.
b. With trade, a country can increase its political involvement on a global scale.
c. Increased U.S. trade would improve high-tech exports but not agricultural exports.
d. Increased trade would increase U.S. exports and decrease U.S. imports.
e. Increased trade implies that exports of goods and services will always equal imports of goods and services.
A
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A value-added tax or VAT is a tax on
a. retail purchases only. b. wholesale purchases only. c. pollution. d. all stages of production of a good.
Starting from potential output, if firms become less optimistic about the future and decide to decrease their investment in new capital, then this will generate a(n) ________ gap and inflation will ________.
A. expansionary; decrease B. recessionary; decrease C. recessionary; increase D. expansionary; increase
A laissez faire policy approach during a recession would advocate
A. Increasing AS by funding programs that improve worker skills. B. Increasing AD by increasing government spending. C. Noninterference by the government. D. Increasing both AD and AS.
Price is the coordinating mechanism in a planned economy.
Answer the following statement true (T) or false (F)