An individual consumes only two goods, X and Y. Which of the following expressions represents the utility maximizing market basket?
A) MRSxy is at a maximum.
B) Px/Py = money income.
C) MRSxy = money income.
D) MRSxy = Px/Py.
E) all of the above
D
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There are many reallife examples of factorintensity differences across the same industries in different nations. How does the HeckscherOhlin model handle this?
A. The HO model makes no assumptions about different factor intensities. B. The HO model assumes that all firms require equal amounts of capital and labor just to be on the safe side. C. The HO model ignores the possibility of different factor intensities and instead assumes that each industry has the same factor intensity in every nation. This assumption enables the model to predict trade based on other factors. D. Actually, the factorintensity reversal issue does not change the predictive value of the model.
Investment banks specialize in
(a) Managing borrowing and the deposits of its customers (b) Managing commercial papers (c) Facilitating the loan interactions between banks and merchants (d) Handling long-term securities such as stocks, bonds and other securities.