Refer to the given diagram and assumptions. If migration is costless and unimpeded, the absolute wage bill will necessarily:
(1) The demand for labor in Alphania and Betania are as shown by D A and D B ,
respectively; (2) Alphania's native labor force is F and that of Betania is g; (3) wage L in Alphania is equal to wage m in Betania; and (4) full employment exists in both countries.
A. increase in Alphania if its labor demand curve is elastic.
B. increase in Betania if its labor demand curve is elastic.
C. decrease in Betania.
D. increase in Betania.
B. increase in Betania if its labor demand curve is elastic.
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The Bretton Woods exchange rate system was a
A) fixed exchange rate system. B) floating exchange rate system. C) flexible exchange rate system. D) managed float exchange rate system.
The move to an international gold standard between 1896 and World War I:
a. encouraged the free flow of goods and capital between countries. b. was accompanied by moderate increases in prices. c. required a higher use of resources than would have been the case under a paper standard. d. made it difficult to exercise expansionary monetary policy. e. All of the above.