Countries gain from specializing in producing goods in which they have ________ and trading for goods in which other countries have ________

How would an increase in the U.S. federal budget deficit affect the exchange rate in the market for dollars?

A) The exchange rate will increase. B) The exchange rate will not be affected by a change in the federal budget deficit. C) The exchange rate will decrease. D) The impact of the increase in the federal budget deficit on the exchange rate cannot be predicted.

If an established domestic industry is in jeopardy of being displaced by lower-priced imports, there could be a rationale for

a. permanent import restrictions to prevent the decline of the domestic industry b. temporary import restrictions to allow the orderly adjustment of the domestic industry c. permanent import restrictions based on the infant industry argument d. temporary import restrictions based on the infant industry argument e. temporary import restrictions that will be replaced by permanent tax breaks for the domestic industry