The pauper labor theory, and the exploitation argument
A) are theoretical weaknesses that limit the applicability of the Ricardian concept of comparative advantage.
B) are theoretically irrelevant to the Ricardian model, and do not limit its logical relevance.
C) are not relevant because the Ricardian model is based on the labor theory of value.
D) are not relevant because the Ricardian model allows for different technologies in different countries.
E) invalidate the Ricardian model.
B
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The U.S. aggregate demand curve shifts leftward if
A) the economic conditions in Europe improve so that European incomes increase. B) there is a tax cut. C) the Federal Reserve increases the interest rate. D) the exchange rate falls.
When the government decides to impose a tax on sellers of a good or service, sellers try to pass the tax on to consumers by raising the price of the good being sold
Assume the government decides to place a $1 tax on each unit of a good sold, e.g., tires. Using the simple model of supply and demand, illustrate what would happen to the price and quantity of tires sold. Would the amount of tax paid by the consumer (as opposed to the producer) be greater when demand is elastic or inelastic? Why?