Select an empirical fact about labor and capital mobility impacts on a country’s gross domestic product:
a. Countries open to trade can expect a higher return on labor investment when compared to countries less open to trade.
b. Countries open to trade can expect a lower return on labor investment when compared to countries less open to trade.
c. Countries less open to trade can expect a higher return on labor investment when compared to countries open to trade.
d. There is no empirical relationship between labor and capital mobility and gdp.
Ans: a
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a. a recession. b. stagnation. c. deflation. d. inflation.
You are thinking about creating an interest group about a policy issue that is very important to you. You know you need to attract as many members as possible, thus giving you political sway in policymaking circles. But you are aware of the free rider problem. Describe this problem and discuss the available solutions to mitigate it.
What will be an ideal response?