Which of the following is true according to the case study on U.S. / China trade presented in the chapter?
A) China has relative abundance in capital.
B) China has relative abundance in skilled labor.
C) The United States has relative scarcity in unskilled labor.
D) The United States has relative scarcity in capital.
C
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Static tax analysis assumes that
A) an increase in a tax rate may lead to a decrease in the tax base. B) an increase in a tax rate will lead to an increase in the tax base. C) an increase in a tax rate will leave the tax base unchanged. D) the tax base will always remain unchanged.
In the country of Freedonia, men and women have the same level of education and choose different forms of work in the same proportions. The only real difference is that men typically stay home to raise young children, returning to the work force after their children enter elementary school. If no discrimination exists, then we would expect that, on average,
a. women would earn less than men. b. women would earn more than men. c. men and women would earn the same wage. d. wage differences between men and women would be due to differences in beauty.