David Ricardo's model, which provided an explanation of why nations trade, was based on:

Figure 4.2 illustrates the supply and demand for t-shirts. If the actual price of t-shirts is $7, there is an

A) excess supply of 8 t-shirts. B) excess supply of 10 t-shirts. C) excess demand of 8 t-shirts. D) excess demand of 10 t-shirts.

Milton Friedman called the response of lower interest rates resulting from an increase in the money supply the ________ effect

A) liquidity B) price level C) expected-inflation D) income