In the open-economy ISLM model, the goods market equilibrium condition is
A) output = consumption + investment + government spending.
B) output = consumption + investment + government spending - tax.
C) output = consumption + investment + government spending + net export.
D) output = potential output.
C
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The marginal revenue for a single-price monopoly with a downward-sloping demand curve
A) is less than the price. B) is greater than the price. C) is equal to the price. D) might be more than, less than, or equal to the price, depending on whether the slope of the demand curve exceeds 1.0 in magnitude. E) might be more than, less than, or equal to the price, depending on whether the price elasticity of demand exceeds 1.0 in magnitude.
The concept of ________ explains how trade between two countries can make each better off
A) absolute advantage B) autarky C) trade barriers D) comparative advantage