What are the implications for economic growth for countries specializing in consumer goods rather than capital goods? Assume that they cannot trade what they produce
What will be an ideal response?
All else equal, countries that specialize in consumer goods will likely grow less than those that specialize in capital goods, because specializing in capital goods will allow for more goods to be produced in the future.
Difficult: M
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A curve with a positive but decreasing slope represents a relationship where, every time the variable measured along the horizontal axis increases by one unit, the variable measured along the vertical axis
A) increases by a decreasing amount. B) decreases. C) does not change by much. D) increases by an increasing amount. E) increases by a constant amount.
Suppose the Fed bought $150 million of U.S. securities from security dealers. The reserve requirement is 20 percent, and there are no initial excess reserves. A few weeks later, if the public's holdings of currency are constant and the banks have loaned all excess reserves, the money supply will increase by:
a. $150 million. b. $300 million. c. $600 million. d. $750 million.