Automobiles and many other products are differentiated. As a result
A) different countries may each have a comparative advantage in producing different types of automobiles.
B) consumers of automobiles have difficulty deciding what type of imported automobile to buy.
C) the quality of imported automobiles is less than it could be.
D) we see countries specializing completely in the production of automobiles.
Answer: A
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During periods when the inflation rate fluctuates widely, _____
a. the nominal interest rate and the real interest rate are identical b. all money prices rise at the same rate, causing relative prices to increase c. suppliers link the selling prices of their goods to the overall inflation rate d. uncertainty about changes in relative prices causes a decrease in economic efficiency e. all money prices increase at the same rate, leaving relative prices constant
If land is reallocated or switched from agricultural use to recreational use, then it is likely that
A. the demand curve for land in the agricultural industry is shifting to the right. B. the demand for food is less today than in previous decades. C. food is not as important as recreation. D. land earns a higher rent in recreational use than in agricultural use.