An increase in wealth that doesn't affect labor supply would cause the IS curve to ________ and the FE line to ________.
A. shift up and to the right; shift left
B. shift up and to the right; be unchanged
C. shift down and to the left; be unchanged
D. shift down and to the left; shift left
Answer: B
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In the United States, Texas ranks number one in the amount of installed megawatts for wind power generation and Florida ranks number one in the number of beach vacations. These facts point out that
A) Texas has a comparative advantage in wind power generation. B) Texas definitely has an absolute advantage in wind power generation. C) Florida should produce more wind energy. D) Florida can produce wind energy at a lower opportunity cost than can Texas.
Refer to Figure 2-11. What is the opportunity cost of producing 1 pound of cashews in Pakistan?
A) 3/8 of a bolt of cotton B) 5/8 of a bolt of cotton C) 1 3/5 bolts of cotton D) 240 bolts of cotton