For purposes of determining comparative advantage, the cost of producing a good in each of two countries is measured in terms of:
a. metric units only.
b. opportunity costs.
c. total costs.
d. the currency of the importing country.
e. the currency of the exporting country.
b
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If the level of investment in an economy is $4,000 and the GDP of the economy is $10,000, the savings rate in the economy must be:
A) 40%. B) 44%. C) 30%. D) 20%.
Which of the following best explains why many US economists support free international trade?
(a) Workers who lose their jobs can collect unemployment compensation (b) It is more important to reduce world inflation than to reduce US unemployment (c) Workers are not affected; only businesses suffer (d) The long-run gains to consumers and some producers exceed the losses to other producers (e) Government can protect US industries while encouraging free trade