Assume that by devoting all of its resources to the production of X, nation Alpha can produce 40 units of X. By devoting all of its resources to Y, Alpha can produce 60Y. Comparable figures for nation Beta are 60X and 40Y. We can conclude that:
A. the terms of trade will be 3X equals 1Y.
B. Alpha should specialize in Y and Beta in X.
C. Alpha should specialize in X and Beta in Y.
D. there is no basis for mutually beneficial specialization and trade.
B. Alpha should specialize in Y and Beta in X.
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The present value of a given payment in the future ________ when the interest rates fall
A) decreases B) reverts to the original value C) increases D) remains the same
When a firm raises the price of its product, what happens to its total revenue?
A) If demand is elastic, total revenue decreases. B) If demand is unit elastic, total revenue increases. C) If demand is inelastic, total revenue decreases. D) If demand is elastic, total revenue increases. E) If demand is unit elastic, total revenue decreases.