What are the implications for economic growth for countries specializing in consumer goods rather than capital goods? Assume the countries consume 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.
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A government may view with favor its country's importing more than it exports provided that the
a. exports are to the countries from which it imports b. imports are luxuries that have little effect on the economy c. imports are capital goods such as machinery that will be used to create future exports d. balance of payments still nets out to zero e. countries exporting to it are willing to increase their tariffs to restore balance
Two firms, Acme and FirmCo, have access to five production processes, each of which has a different cost and gives off a different amount of pollution. The daily costs of the processes and the corresponding number of tons of smoke emitted are shown in the table below.Process(smoke/day) A(10 tons/day) B(8 tons/day) C(6 tons/day) D(4 ton/day) E(2 tons/day) Cost to Acme ($/day) $750$800$1,000$1,400$2,000 Cost to FirmCo ($/day) $500$750$1,200$2,200 $4,000Suppose the firms are both currently using process A. If the government requires each firm to reduce pollution by 20%, then the firms will adopt process ________, and a total of ________ tons of smoke will be emitted each day.
A. B; 16 B. A; 18 C. C; 12 D. D; 8