According to the Stolper-Samuelson theorem, a price change that reduces a country's production of its exportable product would
A. reduce the returns to the factor of production used intensively in the export industry.
B. raise the returns to all factors of production within the country.
C. reduce the returns to the factor of production used intensively in the import-competing industry.
D. reduce the returns to all factors of production within the country.
Answer: A
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The quantity of goods and services that firms produce and sell at each price level is shown on the
a) aggregate-services curve. b) market-supply curve. c) aggregate-demand curve. d) aggregate-supply curve.
In the economy of Brightland, the commercial banks have deposits of $600 billion. Their reserves are $60 billion. All reserves are in deposits with the Central Bank and the commercial banks hold no excess reserves
There is $120 billion in Central Bank notes outside the banks, and there are no coins. a) What is the economy's monetary base? b) What is the quantity of money in the economy? c) Calculate the money multiplier. d) Suppose the Central Bank of Brightland undertakes an open market purchase of securities of so that the monetary base increases by $5 billion. By how much will the quantity of money change?