Initially trade between Australia and the United States is balanced. Then, if a change in the exchange rate increases the U.S. dollar price of Australian goods, ceteris paribus, we would expect
A. a trade deficit in Australia.
B. a trade deficit in the United States.
C. a trade surplus in the United States.
D. a trade deficit in both countries.
Answer: B
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Which of the following statements is true of the equilibrium price of a good?
a. The equilibrium price of a good is the price where the quantity demanded of the good is equal to the supply of the good. b. The equilibrium price of a good is the price where the quantity demanded of the good is equal to the quantity supplied of the good. c. The equilibrium price of a good is the price where the demand for the good is equal to the supply of the good. d. The equilibrium price of a good is the price where the demand for the good is equal to the quantity supplied of the good.
Which of the following is an example of an innovation that can lead to new investment and spur the economic growth of a nation?
a. Horizontal drilling and hydraulic fracturing resulting in the discovery of new sources of shale gas in the U.S. b. Outsourcing the manufacturing units of a U.S. shoe-making company, resulting in the reduction of overhead costs c. A tire manufacturer laying off some of its workers to increase its profit margin d. An automobile-manufacturing company using cheaper machines for its main product line