A widget costs $50 in the US and CAD$53 in Canada. The current exchange rate is 1USD=1.09CAD. At this rate,
a. The good costs more in the US
b. The good costs more in Canada
c. The good costs the same across the two countries
d. None of the above
a
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The four components of the aggregate expenditures model are:
a. consumption, investment, inventories, and government purchases. b. consumption, planned investment, unplanned changes in inventory, and exports. c. consumption, investment, government purchases, and net exports. d. consumption, investment, exports, and imports.
Physical and human capital investments are
a. different in that the opportunity for economic profit is present for physical capital but not human capital decisions. b. different in that human capital decisions do not involve future income considerations while physical capital investments do. c. similar in that non-pecuniary considerations do not influence the choices of utility-maximizing decision makers in either case. d. similar in that both involve forgoing current income (and consumption) with the objective of increasing one's future income (and consumption).