If the world price of coffee is higher than Colombia's domestic price of coffee without trade, then Colombia
a. should import coffee.
b. has a comparative advantage in coffee and should export coffee.
c. should produce just enough coffee to satisfy domestic demand.
d. should produce no coffee domestically.
b
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What happens to real money demand (rise, fall, no change) due to a change in each of the following factors?
(a) A tax on stock market transactions is introduced. (b) Computerized bond trading reduces transactions costs. (c) People's average level of wealth rises. (d) The threat of a recession increases the riskiness of stocks and bonds. (e) The interest rate paid on checking account balances declines. (f) The price level falls in a one-time jump.
Which of the following is not true with respect to money market mutual funds?
A) They allow small savers to pool their funds to buy a diversified portfolio of money market instruments. B) They often include securities such as Treasury bills, Treasury bonds, commercial paper, and negotiable CDs. C) They charge a small management fee. D) Most funds offer limited withdrawal by check.