If a nation's goods exports are $55 billion, while its goods imports are $50 billion, we can conclude with certainty that this nation has a:
A. balance of trade (goods) surplus.
B. balance of payments surplus.
C. positive balance on current account.
D. positive balance on goods and services.
A. balance of trade (goods) surplus.
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According to a study of the price elasticities of products sold in supermarkets, the price elasticity of demand for toothpaste is estimated at -0.45. Which of the following could explain why the price elasticity of demand for toothpaste is so low?
A) Toothpaste is heavily endorsed by dentists. B) Toothpaste is relatively inexpensive. C) There are few close substitutes for toothpaste. D) The toothpaste industry is highly competitive.
Keynes was motivated to create a macroeconomic theory different from classical theory because
A) he believed in government intervention in the economy. B) he believed in the idea of the invisible hand. C) monetary policy was more important than the classicals acknowledged. D) classical theory was inconsistent with the data in the Great Depression.